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37th PARLIAMENT, 2nd SESSION

Standing Committee on Public Accounts

EVIDENCE

CONTENTS

Monday, February 24, 2003

1530

The Chair (Mr. John Williams (St. Albert, Canadian Alliance))

Mr. Mac Harb (Ottawa Centre, Lib.)

The Chair

Mr. Mac Harb

The Chair

Mr. Mac Harb

The Chair

Mr. Mac Harb

The Chair

Mr. Mac Harb

The Chair

Ms. Sheila Fraser (Auditor General of Canada, Office of the Auditor General of Canada)

1535

The Chair

Mr. Mac Harb

The Chair

Hon. Martin Cauchon (Minister of Justice)

1540

1545

The Chair

Mr. Morris Rosenberg (Deputy Minister and Deputy Attorney General, Department of Justice)

1550

The Chair

Mr. Garry Breitkreuz (Yorkton—Melville, Canadian Alliance)

Mr. Martin Cauchon

Mr. Garry Breitkreuz

Mr. Martin Cauchon

The Chair

Mr. Mac Harb

Mr. Steve Mahoney (Mississauga West, Lib.)

The Chair

Mr. Garry Breitkreuz

Mr. Morris Rosenberg

Mr. Garry Breitkreuz

Ms. Sheila Fraser

1555

Mr. Garry Breitkreuz

Mr. Martin Cauchon

Mr. Garry Breitkreuz

Mr. Martin Cauchon

The Chair

Mr. Mac Harb

The Chair

Mr. Mac Harb

The Chair

Mr. Martin Cauchon

Mr. Garry Breitkreuz

The Chair

Mr. Odina Desrochers (Lotbinière—L'Érable, BQ)

1600

Mr. Martin Cauchon

Mr. Odina Desrochers

Mr. Morris Rosenberg

Mr. Odina Desrochers

Mr. Morris Rosenberg

Mr. Odina Desrochers

Mr. Morris Rosenberg

Mr. Odina Desrochers

Mr. Morris Rosenberg

Mr. Odina Desrochers

Mr. Morris Rosenberg

Mr. Odina Desrochers

Mr. Morris Rosenberg

1605

Mr. Odina Desrochers

Mr. Morris Rosenberg

Mr. Odina Desrochers

Mr. Morris Rosenberg

Mr. Odina Desrochers

Mr. Morris Rosenberg

The Chair

Mr. Martin Cauchon

The Chair

Mr. Steve Mahoney

1610

Ms. Sheila Fraser

Mr. Steve Mahoney

Ms. Sheila Fraser

Mr. Steve Mahoney

Ms. Sheila Fraser

Mr. Steve Mahoney

Ms. Sheila Fraser

Mr. Steve Mahoney

Ms. Sheila Fraser

Mr. Steve Mahoney

Ms. Sheila Fraser

Mr. Steve Mahoney

Ms. Sheila Fraser

Mr. Steve Mahoney

Ms. Sheila Fraser

Mr. Steve Mahoney

Ms. Sheila Fraser

The Chair

Mr. Steve Mahoney

The Chair

Mr. Steve Mahoney

The Chair

Mr. Steve Mahoney

Ms. Sheila Fraser

1615

Mr. Steve Mahoney

Ms. Sheila Fraser

Mr. Steve Mahoney

Ms. Sheila Fraser

Mr. Steve Mahoney

Ms. Sheila Fraser

Mr. Steve Mahoney

The Chair

Ms. Sheila Fraser

The Chair

Ms. Judy Wasylycia-Leis (Winnipeg North Centre, NDP)

The Chair

Ms. Judy Wasylycia-Leis

The Chair

Mr. Martin Cauchon

1620

Ms. Judy Wasylycia-Leis

Ms. Sheila Fraser

Ms. Judy Wasylycia-Leis

Ms. Sheila Fraser

The Chair

Mr. Morris Rosenberg

1625

The Chair

Ms. Sheila Fraser

The Chair

Mr. Gerald Keddy (South Shore, PC)

The Chair

Mr. Morris Rosenberg

1630

Mr. Gerald Keddy

Mr. Morris Rosenberg

Mr. Gerald Keddy

Mr. Morris Rosenberg

Mr. Gerald Keddy

The Chair

Mr. Gerald Keddy

Mr. Martin Cauchon

Mr. Gerald Keddy

Mr. Morris Rosenberg

Mr. Gerald Keddy

Mr. Morris Rosenberg

Mr. Gerald Keddy

The Chair

Ms. Val Meredith (South Surrey—White Rock—Langley, Canadian Alliance)

Mr. Morris Rosenberg

Ms. Val Meredith

Mr. Morris Rosenberg

Ms. Val Meredith

Mr. Morris Rosenberg

1635

The Chair

Ms. Val Meredith

Mr. Morris Rosenberg

Ms. Val Meredith

The Chair

Mr. Mac Harb

The Chair

Ms. Val Meredith

The Chair

Ms. Val Meredith

Mr. Morris Rosenberg

Ms. Val Meredith

Mr. Morris Rosenberg

1640

Ms. Val Meredith

Mr. Morris Rosenberg

Ms. Val Meredith

The Chair

Mr. Garry Breitkreuz

The Chair

Ms. Val Meredith

The Chair

Mr. Roger Gaudet (Berthier—Montcalm, BQ)

The Chair

Mr. Roger Gaudet

Mr. Martin Cauchon

Mr. Roger Gaudet

Mr. Martin Cauchon

The Chair

Mr. Roger Gaudet

Mr. Martin Cauchon

1645

Mr. Roger Gaudet

The Chair

Mr. Roger Gaudet

The Chair

Mr. Martin Cauchon

The Chair

Mr. Roger Gaudet

The Chair

Ms. Beth Phinney (Hamilton Mountain, Lib.)

Mr. Martin Cauchon

Mr. Morris Rosenberg

Ms. Beth Phinney

The Chair

Ms. Sheila Fraser

The Chair

Ms. Beth Phinney

The Chair

Mr. Morris Rosenberg

Ms. Beth Phinney

The Chair

Mr. Morris Rosenberg

The Chair

Mr. Garry Breitkreuz

The Chair

Mr. Garry Breitkreuz

The Chair

Mr. Garry Breitkreuz

The Chair

Mr. Shawn Murphy (Hillsborough, Lib.)

1650

The Chair

Mr. Morris Rosenberg

The Chair

Mr. Morris Rosenberg

The Chair

Mr. Mac Harb

1655

Mr. Martin Cauchon

Mr. Mac Harb

Mr. Bill Baker (Chief Executive Officer, Canadian Firearms Program, Department of Justice)

Mr. Mac Harb

Ms. Sheila Fraser

Mr. Mac Harb

The Chair

Mr. Paul Forseth (New Westminster—Coquitlam—Burnaby, Canadian Alliance)

Mr. Martin Cauchon

1700

The Chair

Mr. Paul Forseth

Mr. Martin Cauchon

The Chair

Mr. Bill Baker

Mr. Paul Forseth

The Chair

Mrs. Marlene Jennings (Notre-Dame-de-Grâce—Lachine, Lib.)

Mr. Martin Cauchon

1705

The Chair

Mr. Martin Cauchon

The Chair

Mr. Joe Jordan (Leeds—Grenville, Lib.)

Ms. Sheila Fraser

Mr. Joe Jordan

Ms. Sheila Fraser

Mr. Joe Jordan

Ms. Sheila Fraser

Mr. Joe Jordan

1710

The Chair

Mr. Joe Jordan

The Chair

Mr. Martin Cauchon

The Chair

Mr. Paul Harold Macklin (Northumberland, Lib.)

Ms. Sheila Fraser

Mr. Paul Harold Macklin

Ms. Sheila Fraser

Mr. Morris Rosenberg

1715

The Chair

Ms. Sheila Fraser

The Chair

Ms. Sheila Fraser

The Chair

Mr. Garry Breitkreuz

Mr. Mac Harb

Mr. Garry Breitkreuz

The Chair

Mr. Mac Harb

The Chair

Mr. Mac Harb

The Chair

Mr. Mac Harb

The Chair

Mr. Mac Harb

The Chair

Mr. Mac Harb

The Chair

Mr. Mac Harb

The Chair

Mr. Mac Harb

The Chair

Mr. Mac Harb

The Chair

Mr. Mac Harb

The Chair

Mr. Garry Breitkreuz

Mr. Mac Harb

The Chair

Mr. Mac Harb

The Chair

Mr. Mac Harb

The Chair

Mr. Garry Breitkreuz

The Chair

Mr. Garry Breitkreuz

The Chair

Mr. Garry Breitkreuz

The Chair

Mr. Morris Rosenberg

The Chair

Mr. Morris Rosenberg

The Chair

Mr. Martin Cauchon

Mr. Odina Desrochers

Mr. Martin Cauchon

The Chair

Mr. Mac Harb

1720

The Chair

Mr. Mac Harb

The Chair

Mr. Mac Harb

The Chair

Mr. Mac Harb

The Chair

Mr. Odina Desrochers

Mr. Morris Rosenberg

Mr. Odina Desrochers

Mr. Morris Rosenberg

Mr. Odina Desrochers

Mr. Martin Cauchon

The Chair

Mr. Roger Gallaway (Sarnia—Lambton, Lib.)

Mr. Martin Cauchon

Mr. Roger Gallaway

1725

Mr. Martin Cauchon

The Chair

Ms. Judy Wasylycia-Leis

Mr. Martin Cauchon

The Chair

Mr. Gerald Keddy

The Chair

Mr. Martin Cauchon

1730

The Chair

Mr. Martin Cauchon

The Chair

Ms. Sheila Fraser

The Chair

Mr. Martin Cauchon

The Chair

Mr. Martin Cauchon

The Chair

Mr. Martin Cauchon

The Chair

Mr. Morris Rosenberg

The Chair

Mr. Steve Mahoney

Mr. Martin Cauchon

Mr. Steve Mahoney

Mr. Martin Cauchon

Mr. Steve Mahoney

Mr. Martin Cauchon

Mr. Steve Mahoney

Mr. Martin Cauchon

Mr. Steve Mahoney

Mr. Martin Cauchon

1735

The Chair

Ms. Sheila Fraser

The Chair

Mr. Martin Cauchon

The Chair

CANADA

Standing Committee on Public Accounts

NUMBER 016

2nd SESSION

37th PARLIAMENT

EVIDENCE

Monday, February 24, 2003

[Recorded by Electronic Apparatus]

¹ (1530)

[English]

The Chair (Mr. John Williams (St. Albert, Canadian Alliance)): Good afternoon, everybody. Welcome to the public accounts committee. This afternoon, pursuant to Standing Order 108(3)(e), we are considering chapter 10, the Department of Justice, the costs of implementing the Canadian firearms program of the December 2002 Report of the Auditor General of Canada.

And for those people who are watching on television, that's the Auditor General's report that was in the media. We are having a hearing this afternoon to hear a report and the response by the department.

One of our witnesses today who is appearing is the Honourable Martin Cauchon, the Minister of Justice. Welcome to the committee.

From the Department of Justice also, we have Mr. Morris Rosenberg, the Deputy Minister and Deputy Attorney General; and Mr. Bill Baker, the chief executive officer of the Canadian firearms program.

From the Office of the Auditor General, we have Ms. Sheila Fraser, the Auditor General of Canada; Mr. Hugh McRoberts, the assistant auditor general; and Mr. Alan Gilmore, a principal with the office.

It is unusual for the public accounts committee to have a minister before the committee. And I think I mentioned at the previous meeting that we are dealing here with administration; we're not dealing with policy.

Whether the firearms registry is a good issue or not a good issue is not the question this afternoon. It is the administration of the program that is being debated this afternoon. So the chair will rule out of order any questions, comments, and so on if somebody goes down the track of policy. That is not part of the mandate of this program, of this committee, so that will be ruled out of order.

As normal, we start with an opening statement by the--

Mr. Mac Harb (Ottawa Centre, Lib.): I have a point of order, Mr. Chair. I could be the only one who has not received your notice.

It was my intention at our last meeting to put a notice of motion before the committee dealing with the fact that some members on the opposition side of this committee have made a big deal out of the fact that the report was not coming forward fast enough for them. As a result of the assurances of the clerk that the report dealing with Groupaction was going to be brought--

The Chair: Mr. Harb.

Mr. Mac Harb: I have a point of order, Mr. Chair. Let me finish my say to this, Chair. You don't know what I'm going to say. It's a point of order.

The Chair: Well, it had better be relevant to the gun registry.

Mr. Mac Harb: It is very relevant, Mr. Chair.

I want to find out first, since we have only 24 hours before tomorrow's meeting, whether or not we are going to have the meeting that I was told was going to take place. Is the report on Groupaction going to be brought in before the committee tomorrow, as I was given assurances was going to be the case?

I would ask for this to be set on the record so at least I know whether or not I have to put in a motion so this report will be brought into the committee and so we can deal with it in a timely fashion, as you have asked.

The Chair: As you know, Mr. Harb, tomorrow afternoon there'll be a special meeting of the public accounts committee to deal specifically with the Groupaction report in camera, and if the committee approves the report then, it will be tabled at as early a date as possible soon thereafter.

Mr. Mac Harb: Okay, have the notices gone out?

The Chair: The notices have gone out, according to the clerk.

Mr. Mac Harb: Good enough.

The Chair: Okay, with that interruption, we'll now turn back to Ms. Fraser, the Auditor General of Canada, for her opening statement.

Ms. Fraser, please.

Ms. Sheila Fraser (Auditor General of Canada, Office of the Auditor General of Canada): Thank you, Mr. Chair. We thank you for this opportunity to meet with the committee today to discuss our December 2002 chapter on the cost of implementing the Canadian firearms program.

As you mentioned, with me today are Hugh McRoberts, the assistant auditor general, and Alan Gilmore, the principal responsible for this audit.

To avoid any confusion, I want to be clear that I did not review the merits of the government's firearm control policy, and such a review is not within the mandate of my office. In addition, given that the program was undergoing major changes, I did not audit program operations. I have deferred consideration of such an audit for at least three to four years.

The objective of our audit was to examine the costs of the program and the information provided to Parliament on the program. This program was initially estimated to cost $119 million, with licensing revenues of $117 million, resulting in a net cost of $2 million.

In our audit we found that the department has calculated the costs of the program to be about $688 million to March 31, 2002, and there are forecasts that they will exceed $1 billion by 2004-05, with $140 million of related revenues.

I wish to emphasize that these are cost estimates of the department and we are unable to provide assurance on these numbers. In fact, we stopped our audit of the financial information after an initial review. This review indicated, for example, that the potentially significant costs were not included and that the department could not provide information using an activity-based costing framework, which would have allocated funds based on the purposes for which they were approved rather than by the nature of the expense. Because of these and other significant shortcomings in the information, we concluded that continuing to conduct a more detailed audit would not have resulted in a different conclusion.

[Translation]

I am concerned about the large cost overruns, but I am particularly concerned about the lack of clear and complete information to Parliament. By May 2000, the government was aware that the Program would cost more than $1 billion by 2004-2005. The government and the Department of Justice should have fully informed Parliament about the cost escalation and the mounting problems.

Explanations for the ballooning costs were given to ministers and to central agencies, but Parliament was provided information only piecemeal. While Parliament did approve all of the funding that went to this program, I am concerned that about 70% of that funding was obtained through supplementary estimates.

The Department should have provided Parliament with complete information in its report on plans and priorities and departmental performance report. Such reporting is required by the Treasury Board to allow Parliament to fully scrutinize performance against program plans and keep government accountable. This is particularly the case for the Firearms Program, because it is a Major Crown Project and more stringent Treasury Board reporting policies apply.

We recommend that the Department responsible for the Program provide Parliament annually with complete and accurate information on all Firearms Program costs and revenues and disclose and explain any major Program changes and challenges.

I am concerned about the impact of this failure to adequately inform Parliament. It undermines the essential role of Parliament to oversee spending and to keep government accountable. Steps must be taken to prevent similar situations from arising in the future. In that regard, I would like to call the committee's attention to Chapter 9 of our December report.

¹ (1535)

[English]

In chapter 9, we have a study that proposes a new definition of accountability to take into account changes in the way government operates. It stresses the importance of the means used, as well as results achieved; it points to the obligations of all parties; it underlines the need for review of performance by managers and Parliament, and following through with appropriate consequences for programs and individuals; it emphasizes the importance of transparency in the accountability process; and finally, it takes into account managing for results, sharing accountability among partners, and reasonable risk-taking.

Mr. Chair, this is only a brief overview of our chapter on the costs of implementing the firearms program. My colleagues and I would be pleased to respond to any questions the committee may have.

Thank you.

The Chair: Thank you very much, Ms. Fraser.

Before we move to the minister's opening remarks, I've been asked by Senator Anne Cools if she can attend the meeting. I'm going to invite her to sit at the table. She will not be allowed to ask questions or to participate in the meeting, but as a senator, I think it's appropriate we give her the courtesy of sitting at the table rather than at the back.

Now we'll turn to the opening statement by the minister. He has delivered a five-page opening statement, and I believe he is aware that we have a five-minute time limit for opening remarks. Mr. Rosenberg has advised me that you have a shorter statement; therefore, your longer one will be deposited with the clerk and is available for anyone who would like to get a copy of the longer ministerial statement.

Mr. Harb.

Mr. Mac Harb: Mr. Chair, the tradition is that if the minister has a statement, we would give him the same amount of time we extend to other witnesses. I wonder why we wouldn't want to extend the same courtesy to the minister we extend to any other witness.

The Chair: Well, we extend the courtesy of a five-minute opening statement to all witnesses, and if they have a longer statement, it's always deposited with the clerk for anyone who would like a copy of it. Mr. Rosenberg, his deputy, advised me that the minister does have a shorter statement that he would like to make.

Do we have a copy of the shorter statement? No, we don't.

Mr. Cauchon, please.

Hon. Martin Cauchon (Minister of Justice): Thank you very much, Mr. Chairman and colleagues.

[Translation]

Mr. Chairman, thank you for the opportunity to speak to this Committee about the gun control program, to respond to the Auditor General's report and to outline the Government's plan to improve the program's operation and lower its costs.

With me today is Mr. Morris Rosenberg, Deputy Minister of Justice and Deputy Attorney General of Canada, and Mr. Bill Baker, Chief Executive Officer of the Canadian Firearms Program.

¹ (1540)

[English]

Today the program is in place, and it is producing results: 1.9 million owners have licences; 6 million guns are now registered; and more than 9,000 firearms licences have been refused or revoked for potentially dangerous individuals. Police are accessing the online registry 2,000 times per day. The National Weapons Enforcement Support Team, NWEST, has assisted more than 3,000 police investigations.

Mr. Chairman, all of this makes Canada safer. This is why Canadians from all regions continue to support this policy as an investment in public safety and as a reflection of their values.

I do understand the frustration with the program's delivery problems and costs. I share it. Canadians want the program to continue, but they want it to be administered simply, effectively, and economically. The government is determined to make this happen.

I would like to thank the Auditor General for her report. I've also benefited from a report by an independent management consultant, Mr. Ray Hession. The action plan on firearms that I announced last Friday maintains the integrity of the government's gun control policy, but it focuses decisively on lowering costs, strengthening management, improving service, and increasing transparency and accountability.

[Translation]

Let me begin by speaking about the main reasons for the gun control program's costs and administrative challenges.

The first forecast in 1995 suggested that the program would cost $119 million less $117 million in revenues. In hindsight, it could not have been delivered at that cost. The fact is that the gun control program was a major logistical, technical and management undertaking. A series of changes and external pressures made implementation even more challenging. Requirements evolved in response to public consultations and parliamentary review, and change by change, the project grew more complex.

In addition, the Department of Justice has had many program partners, several with their own independent authority under the Firearms Act, and they had their own demands. Working with them by consensus was well intentioned, but it further taxed administration, complicated program design and raised costs.

Eight provinces and territories withdrew from program delivery, leaving the federal government to assume that responsibility, ultimately in eight jurisdictions, along with the substantial costs of establishing its own offices across the country to do so. A number of provinces also launched a Supreme Court challenge of the Firearms Act. The law's validity was upheld, but until that happened, the discouraged compliance.

Finally, there was a considerable degree of opposition from some gun owners. To promote compliance, fees were reduced or eliminated. These incentives were effective, but almost $100 million in revenues was foregone that would have reduced the net cost of the program.

Throughout this period, officials did their very best to implement the Firearms Act, while responding to new demands and often unprecedented pressures. However, my department and I accept responsibility for how the program evolved, and I can assure Canadians that the government has learned lessons that will help it do a better job in the future.

[English]

In mid-2000 the government began to act on these lessons. It implemented a plan that has lowered costs by 50% in just two years. Its centrepiece was a legislative review, now Bill C-10A, which was tabled in Parliament two years ago. Delays in proceeding with those amendments have prevented even more significant cost reductions and improvements.

Building on these earlier efforts and the report of the Auditor General and Mr. Hession, the government's action plan will lead to an improved, less costly gun control program. Mr. Bill Baker will be the official responsible for implementing this plan.

One of its essential goals will be to maximize the program's transparency and accountability so that Canadians and their parliamentary representatives know how the money is spent. That is why the government welcomes the Auditor General's recommendation and it will act on each and every one. And that's why the plan we have developed calls for an annual report to Parliament and an annual audit plan, as well.

I do want to point out that costs incurred by my department, including cost increases, are disclosed in the public accounts. My predecessor and I, along with officials, appear before parliamentary committees every year to discuss them.

All moneys were voted.

Federal partners reported their own costs. Reporting those costs for a single service would have been unusual. However, in order to provide as much information as possible to Parliament, the cost of the program across government will be reported as the Auditor General recommends.

There is some question about the program's reliance on supplementary estimates. Given the program's constantly changing time lines and requirements, projecting costs and revenues has been extremely difficult. With the completion of the licensing and registration phases, costs will become more predictable.

Mr. Chairman, this committee's views about any additional steps that could be taken to strengthen reporting in the future would be indeed more than welcome.

In addition to increasing transparency, the government's action plan will improve program management in several fundamental ways. National standards and performance measures will be established annually. This spring a continuous improvement plan will be developed with stakeholders to identify further opportunities to lower costs, enhance compliance, and improve service. Comptrollership, risk management, data integrity, and reporting on results would also be strengthened.

A big part of the plan is aimed at answering the concerns of hunters and recreational sport shooters. Lawful gun owners say they want better service. We will deliver, Mr. Chairman.

Over the next year, the program will streamline and focus on administration. And, indeed, an advisory committee composed of individuals outside government, including those with management and systems expertise, will be established to provide regular advice and feedback. And through consultation, the program will be responsive to all Canadians who want it to succeed.

Finally, now that a program is moving from development to ongoing management, I will work with the Solicitor General to transfer it to his portfolio by the target date of April 1. This, I believe, will be a natural fit with the Solicitor General's public safety mandate.

We should not underestimate the challenge of delivering this program in the future, and our success will certainly depend on whether Bill C-10A passes. However, the government will do its best to implement this action plan fully and quickly in order to put the program on a more solid footing with a budget that I believe will be acceptable to Canadians.

¹ (1545)

[Translation]

In conclusion, Mr. Chairman, recently the organizations representing both the police chiefs and front line officers have endorsed my plan. Pierre-Paul Pichette of the Montreal police force puts it this way:

We stand with the victims of firearms violence, public health experts and groups that deal with the safety of women and children, in vigorously defending the law.

Mr. Chairman, Canadians in every region of the country support gun control. They want us to continue this program, but they expect us to improve it. That is what we intend to do.

Thank you.

[English]

The Chair: Thank you very much, Minister.

And now we'll turn to Mr. Rosenberg, the Deputy Minister of the Department of Justice and the Deputy Attorney General of Canada, for his opening statements.

Mr. Rosenberg.

Mr. Morris Rosenberg (Deputy Minister and Deputy Attorney General, Department of Justice): Thank you, Mr. Chair.

[Translation]

Good day. I've served as the Deputy Minister of Justice and Deputy Attorney General of Canada since July 1998. As Deputy Minister, I advise and support the Minister and have overall responsibility for the administration of the Justice Department. I feel it's important to give you a sense of the work we do at the Justice Department.

[English]

We're responsible for providing legal services to the Government of Canada, with over 30 specialized departmental legal services units dealing with matters that often carry significant policy implications and contingent liabilities in the multi-billions of dollars.

[Translation]

The department develops many policies in such areas as penal law, national security, family law and public law. We develop more legislative proposals than most other departments and we are responsible for drafting legislation for the whole of the federal government, a daunting task indeed.

The department's legal staff are active across the country supporting the Attorney General in civil cases involving the federal government, as well as in federal judicial proceedings.

[English]

Apart from the firearms program, the department's program activities focus primarily on federal-provincial-territorial arrangements in areas such as legal aid, youth justice, and aboriginal justice. The CEO of the Canadian Firearms Centre, a position that I created following my arrival in the department, reports directly to me.

I note that the committee has invited two former CEOs, Maryantonett Flumian and Gary Webster, to appear next month. They should be able to assist the committee's questions concerning the day-to-day activities of the Firearms Centre.

I will try to assist as best I can with respect to the broader issues of departmental management as it relates to the centre. I intend to be as forthcoming as possible, subject only to my duty, of which of course I know you are aware, to maintain the confidences of cabinet and of advice provided to ministers. I hope members will understand and appreciate that I have to keep these obligations in mind as I answer your questions.

Thank you.

¹ (1550)

The Chair: Thank you very much, Mr. Rosenberg. Of course, if you do have to do that, you'll just invoke the confidence of your.... There's a standard statement. I can't recall exactly what it is, but if you find you're unable to answer, you can just say so.

We have many people who would like to speak this afternoon; therefore, I will be strict on the time limit. Sometimes I'm reasonably lenient, but today, in order for everybody to have a chance to speak, I will be on time.

Mr. Breitkreuz, you have eight minutes.

Mr. Garry Breitkreuz (Yorkton—Melville, Canadian Alliance): Thank you, Mr. Chairman, and thank you to all the people who are before the committee today to answer our questions.

My first question is for the justice minister. The Auditor General's report was very clear. The Auditor General said Parliament was kept in the dark. Why the cover-up?

Mr. Martin Cauchon: You will understand that from my standpoint I tend to disagree with the way the question is put forward.

I've read the report of the Auditor General. I've read as well all the recommendations, and there are always two sides of the coin. We respect the recommendations, and I said as well before Christmas, and I said it many times in the House and outside the House as well, we accept all the recommendations of the Auditor General. That's why we decided to table a plan of action last Friday, a good plan of action that is talking essentially about more transparency, and more accountability as well.

But when you look at the ways the department has to report, we seize all the occasions that we have, based on our obligation to report. This may be through parliamentary committees, and my predecessor and I appear at parliamentary committees once a year. As well, you can look at the estimates, at the supplementary estimates, at the report on plans and priorities, and you can look at Question Period as well--

Mr. Garry Breitkreuz: Mr. Chairman, can I insist on this very important point. The Speaker--

Mr. Martin Cauchon: Mr. Chairman, I'm sorry, he's asked a question. I'm allowed to answer.

The Chair: Mr. Cauchon, he doesn't have much time. I pointed out that he is limited in his time--

Mr. Mac Harb: Mr. Chair, I have a point of order. He made a very serious allegation. I think it's only fair to allow the minister to answer. If we want to set the tone of this meeting to keep it civilized, I think it would be fair to allow the minister to answer the member.

Mr. Steve Mahoney (Mississauga West, Lib.): Did everybody check their guns at the door?

The Chair: Thank you. That's a very good point, Mr. Mahoney, Mr. Harb.

I would ask the minister to be brief. There are many people who would like to ask questions and the clock is running, so you respect the fact the members only have a limited time.

Mr. Breitkreuz.

Mr. Garry Breitkreuz: Yes, I wanted to zero in on what the minister just mentioned. The Speaker and Parliament couldn't even find an item in the justice department's estimates, and if the minister has that information, I wish he would show it to me. You cannot find that item defined. In fact, the Auditor General made it quite clear it wasn't there. So would you please tell me where that item is clearly in those estimates that you were just talking about.

Mr. Morris Rosenberg: Thank you.

I should explain a little bit about our reporting. I should say at the outset that the department believed that it was reporting in compliance with the government's framework for reporting to Parliament. In hindsight, could we have reported more information? Perhaps we should have, but hindsight is 20:20.

In terms of the framework of how we reported, there was information that we provide on the business line basis. Treasury Board, when the departmental performance reports and the reports on plans and priorities were instituted, I believe in 1997 or 1998, approved three business lines for the department: a law and policy business line, a government client services business line, and an administration--

Mr. Garry Breitkreuz: But did not the Auditor General point out clearly that, because this was a major program, it should have been clearly delineated?

Maybe the Auditor General would like to comment on this.

Ms. Sheila Fraser: Thank you, Mr. Chair.

I think there are two elements of response to the question from Mr. Breitkreuz. First of all, on the moneys voted for the program, all the moneys were properly voted to the program, but we have to remember that the moneys are voted to the Department of Justice as a whole and are not specifically voted to specific programs, so you will not find anywhere the firearms program, so many dollars, and whatever other programs of the department. There will not be a long listing. It is one vote. It is a very large sum of money that goes to the Department of Justice, and it can transfer money between programs as it feels fit.

I think that is part of the issue. I think there may still be an impression that votes are specific to programs, and they aren't. That is part of the issue. More of the detail is given, if you will, in the reports on plans and priorities and the departmental performance report, which start to give a bit of a breakdown.

The issue we brought up is that this program was classified as a major crown project and there were certain reporting requirements that should have been met. There should have been details of a description of the project, the various departments and agencies that were involved in it, the total expenditures to date and planned expenditures for future years, major milestones and progress reports, and other things. So as a major crown project, which the firearms program was, this reporting should have been in the departmental performance report.

¹ (1555)

Mr. Garry Breitkreuz: That's my point. Parliament was kept in the dark.

Originally the gun registry was supposed to cost $2 million to taxpayers. By next year it will have exploded to about $1 billion--that is 500 times over budget. How can this possibly happen that you'd go 500 times over budget?

Mr. Martin Cauchon: I have to back to the very beginning. As I said in my opening statement today, when you look at the complexity of the program today.... It happened that obviously it wasn't possible to deliver the program for that amount of money. When we started to deliver the services on that side, we all remember that there was a solid opposition to the program and therefore a solid opposition to the policy as well. We got involved in various consultation processes, of course, through parliamentary committees and, therefore, with the Canadian population, as well as through stakeholders--let's say the police association--and also with the provinces.

When you look at what we have been obliged to add to the program, of course, in our discussions with those stakeholders, they made very valid comments with regard to what we should add to the program. What we added to the program, as well, added to the safety of our Canadian population, and has made--

Mr. Garry Breitkreuz: Mr. Minister--

Mr. Martin Cauchon: Mr. Chairman, am I not allowed to express myself?

The Chair: You are allowed, Mr. Minister, to express yourself, but it was a fairly simple, direct question. We could go on forever, and as I said, time is very limited.

Mr. Mac Harb: Come on, Mr. Chair, allow the witness--

The Chair: I am prepared to give the minister time to answer questions. Of course I am.

Mr. Mac Harb: Listen--

The Chair: Please proceed.

Mr. Martin Cauchon: So why the escalation of costs? Essentially, it's based on all those components that we've been obliged to add through the consultation process.

An example of that, if I may, is that some provinces have opted out, and territories as well, so we've been obliged to manage the program for those provinces and territories. And it tended to be more costly because we had to put in place our own structure.

Some provinces, as well, have requested a processing centre to be put in place in order to deliver better services to the Canadian population. So those processing sites have been costly as well.

Police forces have asked to have access to the registry from police cruisers. That has also added to the cost of the program.

Technology change: Based on the last fiscal year, the total cost since 1995 in regard to technology is something like $227 million. Technology has been, by far, a bigger challenge than expected.

I can go on like that with various modifications.

Mr. Garry Breitkreuz: Mr. Chair, I--

The Chair: Mr. Breitkreuz's time is out, and therefore we're going to go on to the next one, which is Mr. Desrochers.

S'il vous plaît, huit minutes.

[Translation]

Mr. Odina Desrochers (Lotbinière—L'Érable, BQ): Thank you, Mr. Chairman. Mr. Cauchon, Mr. Rosenberg, Ms. Fraser, welcome to this very important meeting.

My first question is directed to the Minister. Mr. Cauchon, when you were appointed Justice Minister last spring, were you advised of the cost overruns arising from the firearms registry program?

º (1600)

Mr. Martin Cauchon: When I took over the portfolio, I was briefed, like any new minister, at which time I was basically brought up to speed on the department's operations. When I was briefed about the Canadian Firearms Program, the news was positive in that fiscal year 2000 was really the year in which costs were the highest, as you saw from the data. Subsequently, costs began to decline. An action plan was developed and costs have been steadily declining since then. Therefore, when I took over the Justice portfolio, program costs were going down and the outlook was good, all things considered.

Mr. Odina Desrochers: Had Mr. Rosenberg advised you at the time of the cost overruns? I can understand that when you become aware of the costs in recent years, these costs were declining. However, were you told in advance about ballooning program costs?

Mr. Morris Rosenberg: I don't recall the exact details of the briefing, but I would imagine the Minister was briefed on the program's history. The fact of the matter is that a restructuring plan was instituted in 2000 and as such, we were confident of our ability to administer the program. Moreover, costs were decreasing. The Minister was given a general briefing when he took over the portfolio.

Mr. Odina Desrochers: Mr. Rosenberg, when you were Deputy Minister of Justice under Ms. McLellan and later, when Mr. Cauchon was appointed, did you already have some idea of the cost of the firearms registry program? Did you know that program costs were already around several hundred million dollars?

Mr. Morris Rosenberg: At some point in time, department officials became aware of program costs. I admit that yes, there were...I understand the point the Auditor General was making and I want to stress that these costs were disclosed through such parliamentary processes as public accounts and supplementary estimates. Perhaps this is not the type of disclosure recommended by the AG in her report, but substantial information was nonetheless disclosed.

Mr. Odina Desrochers: I'm not interested in that, Mr. Rosenberg. What did you tell Minister Cauchon upon his appointment to office? Did you inform him of the program's current costs and advise him of the corrective action required? That's what I want to know.

Mr. Morris Rosenberg: When Mr. Cauchon took over the portfolio, I believe we were already on the right track. Corrective action was taken and, as the Minister noted, costs declined by 50 per cent over a two-year period.

Mr. Odina Desrochers: Mr. Rosenberg, what were the estimated program costs at the time Mr. Cauchon assumed the Justice portfolio? That's not a difficult question.

Mr. Morris Rosenberg: Of course not. Costs...

Mr. Odina Desrochers: I'd like a figure, please.

Mr. Morris Rosenberg: I can give you a figure. At the start of the last fiscal year, that is 2001-2002, I believe program costs were in the neighbourhood of $688 million. That's the amount reported by Treasury Board officials in November 2001 to the Senate Committee on National Finance, before Mr. Cauchon took over the Justice portfolio.

Mr. Odina Desrochers: I don't quite understand your actions, Mr. Rosenberg and Mr. Cauchon. You knew that costs were escalating and you waited until the Auditor General sounded the alarm in December 2002 before taking action. What transpired in the months preceding the Auditor General's pronouncement that the situation had gotten out of hand and that program costs would soon total $1 billion?

Mr. Morris Rosenberg: We did take a number of initiatives. With all due respect, soon after I became Deputy Minister, we put in place a management team and appointed a chief executive officer to oversee things. A restructuring plan was instituted, a plan that had an impact on program effectiveness and costs. Admittedly, the Justice Department was faced with a very complex challenge. The plan was developed to help us meet this challenge and overall, I think the results have been positive.

º (1605)

Mr. Odina Desrochers: Can you explain to me, Mr. Rosenberg, why it is then that in terms of the funding of the firearms registration program, you didn't submit regular budgetary statements, but rather always submitted requests for supplementary estimates. Explain that to me.

Mr. Morris Rosenberg: I'll do my best. We're dealing with a very complex program. It has been undergoing changes almost constantly and many occurred after the Main Estimates were considered. That's one of the main reasons why we sought additional funding through the supplementary estimates process.

Let me try to explain things to you. I'm sorry, but I will do that in English.

Mr. Odina Desrochers: That's not a problem, provided we understand.

[English]

Mr. Morris Rosenberg: As I said, a lot of the changes were off cycle with the government's main estimates process, and a lot of these changes had a major impact on the planning and costing assumptions for the program, and that required the use of supplementary estimates.

Could we have done things differently? As I said earlier, in that respect perhaps we could have done things differently. And looking ahead, it's clear that the program is much more stable now than it was in the past, and I think you'll see a better balance between supplementary and main estimates from now on. This has already started. You'll see us reporting later this week and further on with respect to the report on plans and priorities.

Even though the supplementary estimates were used, Parliament still had considerable information about the program. Indeed, there was more information about the program in the supplementary estimates than would have been the case at the time if the money had been requested in the main estimates.

Now, here's my point. From its inception, the entire program has been characterized by constant change, making officials reluctant to include spending forecasts for the program in the main estimates. I'll give you a few examples over the life of the program of the kinds of challenges--

[Translation]

Mr. Odina Desrochers: Go ahead, but the clock is ticking.

Mr. Morris Rosenberg: Fine then. I'll be brief.

[English]

First of all, the constitutional challenge brought by the Province of Alberta started in 1996. We didn't get a decision until June 2000. It cast some doubt over the very continued existence of the program. That, in turn, caused many gun owners to delay applying for licences, causing a bulge in applications before January 2001, which was the deadline. And these delays, in turn, drove up the costs of licensing. Delayed implementation of the regulations in 1997 and 1998 also increased costs, in part due to the broad consultations that took place--

The Chair: Okay, I'm going to interrupt there, because Mr. Desrocher's time is up.

The minister indicated he wanted to make a short statement.

[Translation]

Mr. Martin Cauchon: With your permission, Mr. Chairman, I'll only take a few minutes. First of all, if you look at the Justice Department's overall budget, you will see that 90 per cent of budget funds are voted through the Main Estimates, if memory serves me well. Therefore, generally speaking, the department is not taking undue advantage of the supplementary estimates, and this reflects the unique complexity and challenge of the Canadian Firearms Program.

I'd also like to go back to something that was mentioned earlier, namely that all funding was approved by Parliament through the existing process recognized by Treasury Board. The process does not require us to break down in detail the amounts requested. They are included in the Law and Policy line in the Supplementary Estimates.

This being said, the advantage to going the supplementary estimates route is that we then have a way of knowing how much is being sought for a particular program, in this case the Canadian Firearms Program.

[English]

The Chair: Mr. Mahoney, please, eight minutes.

Mr. Steve Mahoney: Thanks, Mr. Chairman.

Mr. Minister, I'm glad to see you've accepted basically all the recommendations of the Auditor General, but that's not unusual. Generally when departments come here following a detailed report by the AG, they tend to come in acceptance of those recommendations. So I'd like to take a little different approach and ask most of my questions, if I might, to the Auditor General.

A statement was made here a few moments ago about how this program has ballooned--I think that was the term--from $2 million to $1 billion. Before I came in here, I heard one of our colleagues in the House from the opposition side quoting you, in fact, saying that the Auditor General had stated that the firearms registry program has wasted $1 billion. Do you have any concerns about people making these kinds of statements and attributing them to you?

º (1610)

Ms. Sheila Fraser: Thank you, Mr. Chair.

I have obviously never said the government wasted $1 billion.

Mr. Steve Mahoney: Thank you.

Ms. Sheila Fraser: We have not done an audit of the benefits, if you will, or the efficiency and economy or the effectiveness of the program. We looked only at the cost to date and how that had been reported.

Mr. Steve Mahoney: Did that cost to date rise to $1 billion?

Ms. Sheila Fraser: The cost to date has not risen to $1 billion. The costs, over time, are projected to be more than $1 billion.

Mr. Steve Mahoney: Okay, so your report states that the total cost to date is $688 million, I believe.

Ms. Sheila Fraser: If I might just correct, that is the cost being reported by the department. Our audit is saying we cannot give any assurance on that cost number, because there are costs that are not included in it.

Mr. Steve Mahoney: Right.

When they reported that cost, did they tell you exactly what it was for? The allegations here are that it's $1 billion for the registry program alone. All of us were aghast when we heard those statements.

On the $688 million that has been spent to date, first of all, over how many years is that, what exactly does it cover, and how much is the registration program specifically within that figure?

Ms. Sheila Fraser: One of the difficulties, just to start, as I mentioned at the beginning, was that we had asked the department to prepare the cost based on activities, which would separate out things like registry, computer program, advertising, or whatever, and they were unable to give us that statement. I believe they may have pulled some information since then, so the department may be able to answer that better than I. We were given a listing of expenses by nature of expense--travel, salaries, etc.

As to how much actually went to the registry--

Mr. Steve Mahoney: Do you have that figure?

Ms. Sheila Fraser: We have costs of the Firearms Centre, and I believe that's essentially it. But we do not have the costs of the registry per se.

Mr. Steve Mahoney: Mr. Hession has done some work, and I'm sure you've seen the report that was prepared. There are a couple of things.

First of all, in his overall findings he states that to really judge the cost of this, you need a baseline. This is on page 1 of his report. He says the first baseline forecast, suggesting that the CFP would cost taxpayers only about $2 million in excess of the fee income it would generate, was plainly based on flawed assumptions. Do you agree with that?

Ms. Sheila Fraser: That is the contention of the department.

Mr. Steve Mahoney: Do you agree with that?

Ms. Sheila Fraser: I would say yes, given subsequent events.

Mr. Steve Mahoney: So the statements, then, that this somehow had the registry itself...which Mr. Hession has also pointed out is about one-third of the total cost of $688 million, or about $225 million. So the balance of the operation of the entire program has to do with licensing. It has to do, in fact, with their mandate, which is to license owners of firearms, register firearms, and authorize the possession, transfer, and transportation of firearms in accordance with the provisions of the Firearms Act and its regulations. So it's the entire firearms program, not just the registry.

Do you agree with that?

Ms. Sheila Fraser: I'm afraid I can't comment on that because, as I mentioned earlier, we asked for a breakdown of the costs by activity and we were unable to receive that. So I have no information as to how much the registry per se cost.

The Chair: Can you provide a reference for that?

Mr. Steve Mahoney: You need a reference for what?

The Chair: You were quoting something from the Hession report. Which page was that?

Mr. Steve Mahoney: I said page 1 for the first one, and then the next one is on page 19.

The Chair: Okay, thank you very much.

You still have about three minutes left, Mr. Mahoney.

Mr. Steve Mahoney: Great.

You've clearly said, Madam Auditor General, that you didn't look at the program. Did you have an advisory committee or anyone else looking at this gun control program, or did you just go in on your own?

Ms. Sheila Fraser: No, as a standard practice in all of our value-for-money audits, we strike an advisory committee of people to give us advice. And we did this in this case as well.

º (1615)

Mr. Steve Mahoney: Could you tell me whether or not Mr. Phillip Stenning was a member of that advisory committee?

Ms. Sheila Fraser: Yes, he was.

Mr. Steve Mahoney: Are you aware that he was a conspicuous and outspoken opponent of gun control during the public debate in 1994 and 1995? In fact, he spoke out against Bill C-68. He even published his objections in a law journal. He served on this committee. Are you aware that he carried that kind of bias to advise you, and if you are, what kind of advice did he give you?

Ms. Sheila Fraser: Mr. Chair, I can't go into the details of what advice we were given. We try to strike our advisory committees so that we do have people of various views, if you will. We met several people in the course of this audit who were quite strong proponents of the program. So I think there was a balance.

We try to strike a balance in all of our reports. I would hope that in reading this, members will agree the report is factual and it gives a story of the costs. We do not comment on the policy.

Mr. Steve Mahoney: That's what confuses me. The costs are there. I would fully admit that your statements have been taken out of context for the benefit of those who would try to trash gun control in this country.

What I'm puzzled about is this. Why would you have a totally outspoken University of Toronto professor, who is published in a law journal and who is opposed to Bill C-68, giving you advice on the economic impact, the cost, or the accounting procedures of the program? It's puzzling to me why you would have someone with that kind of bias giving you advice. Perhaps you could help me.

Ms. Sheila Fraser: I think this is part of our audit procedures. I think it would be, quite frankly, inappropriate for me to start justifying who I engage to advise me or not. I have provided the committee with the details. If the committee believes that the report indicates a bias in any way, I would be glad to entertain questions on that.

Mr. Steve Mahoney: When you did the financial analysis, did you look at the original handgun registration, which cost about $30 million a year to operate? And that was included, by the way, in the $688 million. When you looked at the original handgun registration system, which is being replaced by the new registration system, did you take into account, in your financial findings, the fact that $30 million a year for a number of years was included in those numbers?

The Chair: Your time is up, Mr. Mahoney.

Ms. Sheila Fraser: Mr. Chair, we asked the department to give us a financial statement of the costs of the program. We wanted to audit that. It was a very simple, straight financial audit. We had great difficulty getting the information in the form that we asked for. We had great difficulty getting complete information.

That is what we are reporting to you today. If those costs are included in that, it is because the department included it in it. I'm afraid I can't answer the detailed question. I can give that to the committee.

The Chair: Thank you very much, Ms. Fraser.

And thank you, Mr. Mahoney.

Now we'll turn to Ms. Wasylycia-Leis, eight minutes, please.

Ms. Judy Wasylycia-Leis (Winnipeg North Centre, NDP): Thank you, Mr. Chairperson.

I don't want us to lose sight of the major issues at hand here. We are talking about two important issues.

One, according to the Auditor General's reports, there was a serious issue around the management of the gun registry. We're not talking about a 5% or 10% overrun, are we? Based on the projections, we're talking about a difference of 500 times the original estimate. This has to be handled from the point of view of the extraordinary nature of the problem.

I have two questions today. One is for the minister about this kind of overrun, and the fact that he ought not to be trying to dismiss it in terms of talking about different accounting practices, supplementary estimates, court cases, and constitutional challenges. He should be able to tell us how this happened beyond Parliament.

As the Auditor General said, if it wasn't for her report, I don't think we'd know about it. We're talking about a huge overrun, a huge physical management problem, and Parliament wouldn't have known about it if it wasn't for the Auditor General. I guess if it's not a cover-up, it sure looks like deception. Perhaps it's not intentional, but it sure looks like there's a culture of deception in the whole bureaucracy around this issue.

My question to you is, is that not the case? If so, what do you intend to do about it? I'd like to know your assessment of the situation.

The Chair: Ms. Wasylycia-Leis, we prefer that you stay away from the word “deception”, please.

Ms. Judy Wasylycia-Leis: Okay, I apologize.

Let me say there's a clear perception of deception,

Some hon. members: Oh, oh!

Ms. Judy Wasylycia-Leis: I think we need to know.

Is this allowed? You know what my question is.

The Chair: We'll have the minister's response, please.

Mr. Martin Cauchon: Mr. Chairman, I'm glad to answer that question one more time. Of course, I will repeat myself. My assessment of the situation is that since we got involved in the delivery of that policy back in 1995, I guess we've been facing a lobby strongly opposed to the policy and the program as a whole.

We went through a consultation process, and you know there is no miracle there. I don't know how many times we've changed the program.

As I've said, the way we have reported is to have used supplementary estimates—more than we should have done, of course, which we have recognized. This was also said in the report of the Auditor General. Having said that, each and every time we had to get involved with more spending, we were basically off cycle with the estimates. That's why we've been using the supplementary estimates. As I said before, in using the supplementary estimates, we maybe were providing Parliament with more information. When you look at supplementary estimates, you have a line referring directly to the program you would essentially like more funds for. If you look at the supplementary estimates we've been using, each and every time you have a line for the gun registry.

Mr. Chairman, people have been working hard in that program. It has been complicated, and become far more complex.... In terms of technology, as I said, the total cost has been $227 million. We made something like 12,000 changes to the technology system we put in place. So it has been more complex, and we recognize that maybe we should have used other ways.

As regards our report, we went through the obligations based on the rules of Treasury Board. I believe we have reported the way we should report. As I said, there are always two sides of the coin. I have read the report of the Auditor General, and we have accepted all of her recommendations. If you look at the action plan we have tabled, or look into the future, we will be auditing on a yearly basis and reporting to Parliament on a yearly basis as well. We will be doing more than the obligations we have, based on Treasury Board rules.

º (1620)

Ms. Judy Wasylycia-Leis: I have a question for the Auditor General.

What assurances or what opinion does she have with respect to this new plan of action and the shuffling of the deck or shuffling of the responsibility to a new department? Do you feel that your original concerns and recommendations will be met under this new arrangement?

Ms. Sheila Fraser: Thank you, Mr. Chair.

Our major concern was the information to be provided to Parliament. Whatever department the program is in, we will be looking at future reports of the firearms program to see if the information is being provided .

How the government structures or manages itself is not really part of my mandate, and it would be inappropriate for me to comment on that.

Ms. Judy Wasylycia-Leis: Did members of Parliament miss something, as the minister is suggesting? Or was there a problem in terms of the actual accounting and presentation of those numbers to Parliament, as I believe you've identified?

We feel we are in the dark, and you've said we were in the dark. The minister is trying to suggest otherwise. Who was to blame here?

Ms. Sheila Fraser: Mr. Chair, as I mentioned earlier, we felt that the information given to Parliament was inadequate. There was very little mention of the program in the reports on plans and priorities or in the departmental performance reports. Many of the reports were simply a text, with no or very little financial information.

I know there were several committees who persistently asked for information. So if the information had been there, I think the questioning wouldn't have been as extensive as it was.

As we mentioned earlier, this was classified as a major crown project and had certain rigorous reporting requirements that should have been met. One of the things the committee may like to discuss when we meet with the Treasury Board in a few weeks is what happens when information that should be provided isn't provided.

The Chair: Mr. Rosenberg.

Mr. Morris Rosenberg: That is a very key point. I would like to clarify the firearms program's handling of this, because the issue is raised in the Auditor General's report with respect to the status of the project as a major crown project. It's an important point, because there have been, for the past few years, parliamentary reporting obligations for major crown projects that are different and more extensive.

Clearly, the Canadian firearms program was managed robustly within the government in the sense that the Treasury Board Secretariat exercised more direct control over the progress of the implementation of the program. I don't believe the Treasury Board ever designated the program as a major crown project.

º (1625)

The Chair: Perhaps we can have a clarification from the Auditor General.

Ms. Sheila Fraser: If the committee would like, we can give you that designation in writing.

The Chair: Okay, I'm sure we would like it, so you can send that on.

So, Mr. Rosenberg, okay.

I'm sorry, you're out of time, Ms. Wasylycia-Leis.

Mr. Keddy, eight minutes, please.

Mr. Gerald Keddy (South Shore, PC): Thank you, Mr. Chairman.

Welcome, again, to the Auditor General, and certainly to the minister and the deputy minister.

I'm going to try to keep the statements to a minimum and to ask a couple of questions. And I would very much appreciate it if you could keep your answers as to the point as you could.

In the Auditor General's report, she states:

In 2000, the Department of Justice estimated that by 2004-05 it would spend at least $1 billion on the Program and collect $140 million in fees after refunds. This amount does not include all financial impacts on the government. The Department also did not report to Parliament on the wider costs of the Program as required by the government's regulatory policy.

This has been stated by a number of people here today already.

My question is more to the point, and it's to the deputy minister.

Certainly the Auditor General has stated that the department also did not report to Parliament on the wider cost of the program, as required by the government's regulatory policy. I would expect, as deputy minister, that you fully understand what that regulatory policy is, and you also would understand that it's a very serious issue when a decision is taken to ignore the government's regulatory policy and not to report to Parliament, as required under that policy.

So my question is, who recommended that this decision not to report be made?

The Chair: Mr. Rosenberg.

Mr. Morris Rosenberg: This is an important point and I'd like the opportunity to clarify it. The government's regulatory policy requires a regulatory impact analysis statement, called a RIAS. What is included in the RIAS is very much a matter of judgment to be exercised in the context of a specific regulatory proposal.

The firearms case, I think, is quite unique. The Firearms Act, Bill C-68, was very specific with respect to a set of requirements for full parliamentary review in both Houses of Parliament of proposed regulations, making the RIAS process perhaps a little less relevant. Regulations made under the Firearms Act received parliamentary scrutiny in the House Standing Committee on Justice and in the Senate Committee on Justice and Legal Affairs.

º (1630)

Mr. Gerald Keddy: I appreciate that, Mr. Rosenberg, but my question is specific. Did it originate from you or did it originate from the minister?

Mr. Morris Rosenberg: First of all, the process with these regulations took place before I became the deputy minister. I think this was going on in 1996, through some time in 1998. I'd like to describe this and link back to the RIAS, because there was a RIAS.

Mr. Gerald Keddy: Quickly, please.

Mr. Morris Rosenberg: I will. There was a report, a consolidated report I believe, and the government responded to the report and accepted many of the recommendations. The regulations came from there, from the draft regulations. RIAS described this process for the first major set of regulations, which were registered in March 1998. The RIAS stated that the regulations are in accordance with the government's response to the committee reports.

So, accordingly, the entire body of evidence heard by the committee was readily available to both Parliament and the public, in contrast to the ordinary circumstances where consultations and analyses were really just a summary and reported to the public in the RIAS.

As I say, the use of the RIAS and how you use it is very much a matter of judgment. This is policy and there is discretion that's available. My best understanding of what happened at the time is that, because of the extraordinary nature of this process under the Firearms Act, the RIAS has to be looked at it in that context.

Mr. Gerald Keddy: So we still don't know whether it was you, your department, or the minister who decided that the information wouldn't come forward.

Here's my next question. To enable Parliament to maintain control over the public purse--which is the whole point of having a public accounts committee--the departments ask for approval of supplementary estimates only for unanticipated expenditures not approved by the Treasury Board in the normal business cycle or for those that cannot be estimated in advance. So either someone in this process was totally incompetent and didn't estimate the costs correctly, or a decision was made to try to hide the true costs of the registry by using the supplementary estimates.

Those are harsh words, and I fully understand that, but somehow or another we have to get to the bottom of exactly how this process worked. It amazes me that somehow there's no one who's accountable for any of this; it's all somebody else's difficulty.

The Chair: Are you directing your question to the minister?

Mr. Gerald Keddy: Yes.

Mr. Martin Cauchon: I wasn't there at the time, as well.

It was my understanding of the situation that each and every year during the construction process...because we have to understand that we started the whole system from scratch. We've built a licensing and registration process. We've built what I believe to be a very good program.

My understanding of the situation is that each and every time they proceeded with fixing the numbers for the main estimates, they proceeded with the best evaluation based on the facts they had. Of course, if you look at the number of times we've been using supplementary estimates, it proves that it was extremely difficult to be able to target specific numbers at the beginning of the fiscal year in using the main estimates; otherwise we would have used the main estimates with the total budget, which has been clear, and today I guess we wouldn't be answering such a question.

Mr. Gerald Keddy: I'm going to try another way, and I'll go back to the deputy minister.

The Auditor General has stated that in its regulatory impact analysis statements the Department of Justice did not provide Parliament with an estimate of all the major additional costs that would be incurred. I think that's a pretty straightforward statement. So can you explain to me, if you weren't trying to cover up what was happening within the long-gun registry, which has absolutely nothing to do with gun control--two separate arguments there--why were these costs not reported? Was it your office or the minister's that made the decision not to include them?

Somehow or another, somebody had to be responsible for the lack of information coming forth.

Mr. Morris Rosenberg: Sorry, are you referring again to the RIAS?

Mr. Gerald Keddy: I'm referring to the regulatory impact analysis statement.

Mr. Morris Rosenberg: Yes. As I've explained, given the extraordinary nature of the process in Bill C-68, we felt that there was fulsome opportunity for an analysis. In fact, many, many witnesses came before the House and the Senate committee to talk about costs.

I am informed that is what happened, and it happened some time before I became deputy minister.

Mr. Gerald Keddy: Do I have time for another question?

The Chair: No, you don't, Mr. Keddy. You have five seconds left, not long enough.

Now we'll move on to the second round, which is only four minutes long, and we'll start with Ms. Meredith.

Ms. Val Meredith (South Surrey—White Rock—Langley, Canadian Alliance): Thank you, Mr. Chair.

I have one question that I would like answered with a yes or a no. Was a due diligence study done on the potential cost of the gun registry program before the program was implemented?

Mr. Morris Rosenberg: I'm not aware.

Ms. Val Meredith: So the government went ahead with a major crown program without doing due diligence as to what the costs were going to be, and they changed the computer system 12,000 times. Did I hear that right--12,000 times you changed the information or the programming in the computer registration program?

Mr. Morris Rosenberg: First of all, let me clarify--

Ms. Val Meredith: I don't want anything long; I just want to know whether that is in fact what I just heard.

Mr. Morris Rosenberg: I won't make this long.

There are two things. On the first point, I said I'm not aware. It wasn't a yes or no answer, because I can't give you a yes or no answer. I will try to inform myself as to what happened back in 1994-95--

º (1635)

The Chair: Would you inform the committee here?

Ms. Val Meredith: Yes, I'd like a copy of that report to go the committee, please.

Mr. Morris Rosenberg: Yes, sorry, Mr. Chair.

Secondly, my understanding is that one of the cost drivers was the growing complexity of the system, which went from some 900 function points to 12,000.

Ms. Val Meredith: Okay, so we have a growing complexity in this system, and year after year you go to supplementary estimates to ask for more money, because you can't figure out from one year to the other that it's going to cost more money than you originally asked for. I find this really hard to believe.

I can see your asking for supplementary estimates on one occasion, because something unusual happened. But I'm afraid I feel the same way my colleagues from the NDP, the Tories, and the Bloc Québécois do, that the use of supplementary estimates year after year seems to be a deliberate attempt to use an underhanded, backdoor method of funding this program.

My next question is, how is it possible when you have something run 500 times over budget—

The Chair: There is a point of order.

Mr. Harb has the floor.

Mr. Mac Harb: The member is suggesting there was a deliberate attempt by members of the administration to break the rules, and therefore to break the Financial Administration Act and to do something against the law. I would want to caution the member that I'm sure that's not what she meant.

The Chair: I'm quite sure the officials and the minister before us can speak for themselves.

Ms. Val Meredith: That's right.

The Chair: Ms. Meredith, we don't need any more interruptions.

Ms. Val Meredith: Following up on my concern about your using the supplementary estimates to get funding for a program that you should know you're running into shortfalls with if you're using it year after year, I'd like to know why 94% of senior executives received performances bonuses when it's well documented that they were not doing their jobs sufficiently? There was a 500% overrun or a 500 times overrun on a major crown corporation's program.

Mr. Morris Rosenberg: Mr. Chair, I'd be pleased to try to answer the question.

With respect, I don't accept the premise that people weren't doing their jobs. We put in place a management team in 2000 that had a very challenging task in coming in to deal with what I think everyone will admit was one of the most controversial hot potatoes in the government. They had to get licensing done in about a year, a process that originally was supposed to take five years. They put in place a restructuring plan that started to bring costs down in a significant way. They did get the bulk of licensing done, and they have registered about six million people.

There's a question here as to how you treat people. In my respectful submission, people who come in to take on the toughest assignments the government has, and who meet their objectives, should not be punished for that. Those people met their objectives.

Ms. Val Meredith: Mr. Chair, the Speaker of the House of Commons ruled that $72 million for the gun registry was pulled from the supplementary estimates on December 5. Yet the minister's officials told the media, and his own website claimed, that the $72 million is part of this year's publicly announced $113.5 million of planned spending.

Who has it wrong? Is it part of the planned spending, or is it part of the supplementary estimates? If it was pulled, where does the money come from?

Mr. Morris Rosenberg: I think it was on December 4 or 5 that a unanimous decision was made by all parties to pull the firearms items from the supplementary estimate of $72 million.

We were in a position where we had a program.... By the way, in last year's report on plans and priorities, we had estimated this would cost $113 million. The $72 million would have made it $113 million for the year. We had an obligation to enforce and administer Bill C-68, the gun control law, because Parliament had passed it.

º (1640)

Ms. Val Meredith: How did you fund it?

Mr. Morris Rosenberg: We funded it through what is called cash management, through the Department of Justice.

By the way, because of what happened on December 5, we funded it at a level of activity we refer to as a minimal level. We didn't try to hide this. Several days after the withdrawal of the sups, the minister made a statement in the House that clearly set out what his intention was. So we had been funding it quite legitimately, as the Speaker ruled last week.

Ms. Val Meredith: But you knew you needed $113 million.

The Chair: Ms. Meredith, we'll have to come back to you, but I think it's a valid question. I don't think the House approved....

Is there a point of order?

Mr. Garry Breitkreuz: Every time the government side interrupts us, does it continually count on our time?

The Chair: The clerk stops the clock, so when—

Ms. Val Meredith: Do we get to do the same thing to them?

The Chair: Well, I would hope that with discretion and courtesy, people would not interfere with other people's time.

But as for Ms. Meredith's point, Parliament does not approve cash twice. We do it in the main estimates and we do it in the supplementaries. Perhaps somebody would want to clarify exactly where the $72 million went, because I didn't get the answer.

So now we're going to go to

[Translation]

You have four minutes, Mr. Gaudet.

Mr. Roger Gaudet (Berthier—Montcalm, BQ): Thank you, Mr. Chairman.

My question is for the minister. You seem pleased to say that the government has admitted it made a mistake. However, that doesn't mean the government has been forgiven. A mistake involving tens of thousands of dollars might be forgiven, but when a billion dollars is at issue, forgiveness is harder to come by. Do you believe all will be forgiven simply because you admitted making a mistake?

[English]

An hon. member: Why does he keep saying this?

The Chair: It was addressed—

[Translation]

Mr. Roger Gaudet: Do you think everyone will be willing to forgive and forget?

Mr. Martin Cauchon: That's not the point. Early on in my opening remarks, I stated that the Auditor General's work had been extremely useful to the department, particularly as regards the Canadian Firearms Program. The AG put forward a number of recommendations that we have accepted. I also outlined the department's position vis-à-vis these recommendations. I explained that there are always two sides to every story.

Having said this, when it comes to transparency, lower costs and improved services, we're talking about what the Canadian public in general wants to see and basically, that's what we must deliver. However, since the program's inception, people have worked very hard to ensure that the Canadian Firearms Program is sound and since 2000, costs have decreased substantially. Moreover, we have developed an action plan that improves program administration and provides greater transparency.

Mr. Roger Gaudet: Thank you.

Mr. Rosenberg, if the government was running a deficit, do you think it would have spent an additional $680 million up until 2002? Or, would you have advised the Justice Minister of program cost overruns?

Mr. Martin Cauchon: Mr. Chairman, the Canadian Firearms Program involves a matter of public safety. It reflects Canadian values and affords increased protection to the public in general. The program works well, when one considers the number of permits that have either been denied or revoked--the figure quoted is 9,000--as well as the number of persons who have been issued permits and who are now registered. Currently, we have access to a broad data bank which has already been used over 2,000 times by police forces across Canada. Therefore, when weighing the program's merits, we need to consider that the program reflects Canadian values as well as an important component of our society, particularly in terms of safety...

[English]

The Chair: Mr. Minister, the question was whether you would spend the money this year.

So let's go back to Mr. Gaudet.

[Translation]

Mr. Roger Gaudet: Mr. Rosenberg, if I understood correctly, you've been the Deputy Minister of Justice and Deputy Attorney General of Canada since 1988. How will you be able to assist the new committee that will be struck if thus far you have been unable to contain costs?

Mr. Martin Cauchon: Just a moment...

º (1645)

Mr. Roger Gaudet: I'd like Mr. Rosenberg, not the minister, to answer the question.

[English]

The Chair: The minister has a prerogative to speak on behalf of his deputy or to override his deputy, shall we say. So there we go....

[Translation]

Mr. Roger Gaudet: Thank you, Mr. Chairman.

[English]

The Chair: It's the minister's prerogative.

Mr. Minister, please.

[Translation]

Mr. Martin Cauchon: Basically, Mr. Chairman, we need to go back to the beginning of the program. We admitted that the process was far more complicated than had originally been anticipated. Further to consultations, we added many components to the program and from our perspective today, these proved to be extremely beneficial and cost-effective from a public safety standpoint.

Now that the permit and registration phase is essentially behind us, we can see that we are now getting some good results. If we look to the future, it's obvious the program will much easier to administer as there will be less unpredictability to contend with.

The Chair: Thank you very much, Mr. Gaudet.

Mr. Roger Gaudet: Do I have time for another brief question? No?

The Chair: Your time is up.

[English]

Ms. Phinney, four minutes, please.

Ms. Beth Phinney (Hamilton Mountain, Lib.): Thank you very much, Mr. Chairman.

My question refers to the problem of accountability of the money spent. If I understand the Auditor General correctly, this is partly because the ministry is able to move money around within its department, and then it's not easy to identify what money is being used for what--I think you said that a little bit earlier--and not that the Department of Justice was doing anything wrong with that money.

My question to the deputy minister is, how could we fix this problem so that the process would be more transparent?

After the deputy minister answers it, I'd like the Auditor General to comment on whether she thinks this would solve that problem of accountability.

Mr. Martin Cauchon: If I may, Mr. Chairman, I would just like to tell you that the report on plans and priorities that we have tabled for the fiscal year 2002-03 is a report where you find exactly the numbers to be invested in the program for the year 2002-03, and you find it in a separate item.

Of course, as we said before--and I guess as has been mentioned as well by the Auditor General--in a previous year, we were respecting the rules of the Treasury Board in reporting to one item, and when you look at that item, obviously it doesn't tell you exactly what amount would be spent for the gun control program. When I became justice minister, in the first report on plans and priorities that we tabled and delivered, we adjusted ourselves toward transparency and being more accountable.

Having said that, Mr.--

Mr. Morris Rosenberg: I was going to make reference to the same thing.

Our reporting has evolved. I know the Auditor General's report says it still isn't quite up to snuff, but it has evolved last year, and we did break out under the business lines the specific programs, not just for firearms but for the other major programs as well. So right there, there's an opportunity to see the amount of money that we're projecting to spend.

I should also point out that in the Public Accounts of Canada, at the end of the year there's a reconciliation for firearms by firearms operations and firearms grants and contributions, so you can actually see what was spent.

Beyond that, as the minister pointed out, we have agreed to accept all the recommendations of the Auditor General in her report. Those recommendations do go to more transparent reporting, and we intend to comply with those. I think we've followed that--

Ms. Beth Phinney: And Ms. Fraser...?

The Chair: Could we have a final comment from the Auditor General here?

Ms. Sheila Fraser: Thank you, Mr. Chair.

I think many of the improvements that the minister and the deputy minister have mentioned will go a long way to helping.

One thing that I think would have perhaps avoided some of the confusion that has occurred recently is, for instance, mention of $113 million of planned spending in the report on plans and priorities. I think it would have also been helpful if there had been a breakdown under that to say how much was in the main estimates--some $40 million--and $72 million expected in supplementary estimates. I think that would have cleared up some of the confusion that has been in the House this past week, because the planned spending included both main estimates and planned supplementary estimates.

The Chair: You have 45 seconds, Ms. Phinney.

Ms. Beth Phinney: Thank you very much.

I have just a short question. I'd like to ask the deputy minister how he plans to transfer this registry by April 1.

I wonder if you could give us a brief explanation as to how this will happen. Do all the people go with it, or what happens?

The Chair: You have 30 seconds.

Mr. Morris Rosenberg: Yes.

The Canadian Firearms Centre is kind of a stand-alone program within the Department of Justice. It's physically separate from the Department of Justice. It is in the building at 50 O'Connor Street. It will be transferred to the portfolio of the Solicitor General, reporting to the Solicitor General, as I understand it. Specific details are yet to be worked out, but I don't think there's very much involved other than kind of a paper transaction in transferring it.

Ms. Beth Phinney: Thank you.

The Chair: If I may use the terminology, “lock, stock, and barrel”.

Mr. Morris Rosenberg: Those are your words, Mr. Chairman, not mine.

The Chair: Mr. Murphy, four minutes, please.

Mr. Garry Breitkreuz: Mr. Chairman, can I just ask a question on a point of order?

The Chair: Is it a point of order dealing with debate or--

Mr. Garry Breitkreuz: On a point of order dealing with clarification, what are planned supplementary estimates? That's a contradiction in terms. What is that?

The Chair: Well, we know the supplementary estimates are--

Mr. Garry Breitkreuz: It's “planned” supplementary estimates.

The Chair: No, that is not a point of order, Mr. Breitkreuz.

Mr. Murphy, for four minutes.

Mr. Shawn Murphy (Hillsborough, Lib.): Thank you, Mr. Chairman, and thank you to the witnesses.

My question is to the minister and the deputy minister. We've had a good discussion on this issue this afternoon. In hindsight, what was accomplished with the money that was spent? I don't see it as being unreasonable.

However, when the thing started, the assumptions you were under were pretty rosy--rose-coloured glasses. The bottom line is that the process was not followed and that principles of transparency and accountability were somewhat missing throughout the whole piece.

As a member of this committee, I always look at four questions. How did the process go wrong? Who's responsible? Was corrective action taken, and can Parliament be reasonably sure the problem will not repeat itself?

To your credit, Mr. Rosenberg, I do believe that corrective action has been taken, and I certainly am satisfied that it will not repeat itself. We certainly had a very good explanation from the Auditor General of how the process got off the rails.

Where the answers get a little blurry always is when you ask who's responsible, and that's the problem. I'm going to ask that, and I'm going to ask a number of questions.

Over the years, your department would have done performance reports. During this period of 1996 to 2000, was this problem identified, and if so, was any corrective action taken?

Also, your department would have done internal audits on gun control during this period of time. I assume problems would been identified, and if so, how come Parliament wasn't informed?

Who exactly was responsible for not following the correct procedures, and was that person ever subject to disciplinary action? Is any disciplinary action contemplated? During this period of time, did that person receive merit pay?

º (1650)

The Chair: Mr. Rosenberg, I think we can start with you, and the minister can finish off if he has any other comments.

Mr. Morris Rosenberg: I'll start.

First of all, I should say that our reporting has been evolving. As I pointed out, action was taken within the government through a restructuring plan and robust measures in the year 2000 to get licensing done in a much shorter period than had been contemplated.

With respect to the departmental performance reports, because of the way we were reporting up until last year by business line in the aggregate, you won't find very much in the departmental performance reports about firearms until that time. We changed our reporting in the report on plans and priorities tabled last March. The corresponding departmental performance report on how we did, tabled in the fall, had a much more fulsome explanation of what happened with the firearms program.

Yes, there were six internal audits that took place. A lot of the recommendations were implemented. Some of the recommendations needed legislative changes to implement them, which are reflected in Bill C-10A.

As far as the third part of your question is concerned on who's responsible for not following the rules, this is an issue of some contention. My point was that we believed we were complying with the government's reporting framework and were reporting according to that framework.

The Chair: I'm going to interrupt, because you have 20 seconds left to finish answering all of the questions that Mr. Murphy asked. So you're going to have them condense them down a little bit.

Mr. Morris Rosenberg: I think I was on the last one, Mr. Chair.

There is not a person who is responsible. We thought we were reporting in accordance with the government's reporting framework.

The Chair: Do you have a response, Mr. Minister? Nothing there? Okay.

Now we're going to go to Mr. Harb for four minutes.

Mr. Mac Harb: Thank you very much.

First, I want to thank the Auditor General for her report.

I also wanted to ask Mr. Rosenberg and Mr. Cauchon for a yes or no.

In her report, the Auditor General asked the department to include in the reporting to Parliament the full cost of developing, implementing, and enforcing the Canadian firearms program; she wanted to ensure that all revenues were collected and refunds were made, that costs and revenues be forecasted to the point at which the department expected the program to become fully operational, and that a complete explanation be provided for changes in costs and revenues and changes to the overall program.

I wanted to ask the minister, does he and/or his deputy minister agree with the recommendations of the Auditor General?

º (1655)

Mr. Martin Cauchon: Let's go back to the mandate of the department in regard to the gun control program. If you look in the Auditor General's report, we have been designated as the department being the single point of accountability. That being said, if you look at the report and her recommendation as well, the recommendation says essentially that we have to report not only for the centre, but for all the other stakeholders.

In the course of the discussion with the Office of the Auditor General, of course, if you look at the numbers reported for the centre, that includes provinces as well as major stakeholders like the RCMP and Canada Customs and Revenue Agency. Some stakeholders we haven't reported for. It doesn't mean their expenditures for the program haven't been reported. Each and every department has reported its own expenditures. But through that recommendation, what she would like to have, and we have agreed as well, is to be able to table a report, a sort of consolidated report, in which you will be able to find all the expenditures that have been made by all the departments.

Of course, we are going to have some discussions as well, because some expenditures that they referred to are about sentencing and more law enforcement. Should we report sentencing costs and law enforcement costs through the gun control program? We're discussing that actually with their department, and we're working on that in order to make sure we will come forward as soon as we can with an exact figure to the Canadian public.

Mr. Mac Harb: Does the department have an action plan for implementation, and if so, once that action plan is in place, would the department be willing to make it available to the committee?

Mr. Bill Baker (Chief Executive Officer, Canadian Firearms Program, Department of Justice): The minister tabled an action plan in the House of Commons on Friday. It sets out a number of activities that we will be pursuing over the next year that we believe will address quite substantially all the recommendations of the Office of the Auditor General, plus put in place what we hope to be a more fulsome management regime so that this program can deliver the benefits that it is intended to deliver.

Mr. Mac Harb: Is the Auditor General satisfied with the action plan that the department is embarking on?

Ms. Sheila Fraser: Mr. Chair, we have not looked at it in any detail, given that it was only tabled on Friday, but I am pleased that the minister and the department have accepted our recommendations and have addressed a plan to deal with them.

Mr. Mac Harb: Thank you, Mr. Chair.

The Chair: Thank you very much, Mr. Harb.

Mr. Forseth, four minutes, please.

Mr. Paul Forseth (New Westminster—Coquitlam—Burnaby, Canadian Alliance): Mr. Minister, you've come here to the committee, and what I've heard so far is, in my view, a lot of justification rather than explanation. I hope you're not going to be merely blaming bureaucrats or public service employees. This explanation involves full disclosure, truth, regardless of how politically embarrassing it may be.

I refer to the Hession report. On page 2, it simply says:

The procurement method employed by the government allocated little performance risk to the two contractors who were asked to detail the design and build the solution.

--in other words, it was the taxpayer who had to take all the risks, and the contractors did what they were told by their political masters--

They did what they were told to do and billed accordingly.

So who's going to take responsibility? Do you as political master take full responsibility for what has happened, and especially now, do you take full responsibility as to what's going to happen? We understand that the taxi meter for dollars is continuing to tick over here, so we're looking for political responsibility from the political masters who gave the direction, albeit very poor direction, and put the taxpayer on the hook.

Mr. Martin Cauchon: There are many questions.

If I may start with the first one, in regard to the question of the people who have been involved in building that gun control program, those people have been working hard in order to make sure we put in place a good structure, a valued program, in order to offer better security for our Canadian population and make sure we're going to be able to rely on those values.

So bureaucrats have been working hard, as has been said by Mr. Rosenberg. They've done a tremendous job. It was a complex program, and not only did they do their very best, but I believe today, when you look at the licensing state and registration, the databank that we have, which is used more than 2,000 times a day, they delivered the goods.

In regard to the technology, the way we proceed, if you look at Mr. Hession's report, essentially he says--it's his own words--we decided to move ahead with the policy, and then after we had been working at the same time, while delivering services on the architecture of the whole program....

We have to learn from that, of course, and today we're working with a corporation, based on a performance contract. This year we will have the technology in place and up and running very well in order to offer the Canadian population better services.

That being said, who's accountable? Who is responsible? You know our system, Mr. Chairperson. The person who is responsible is me, actually, as Minister of Justice.

» (1700)

The Chair: Mr. Forseth.

Mr. Paul Forseth: Okay, and then if this program continues to go awry, you take responsibility. We know parliamentary responsibility also means resignation at some point, if that's required.

Now it's your opportunity, to those who are watching us here today.... We've talked about this so-called plan. I'll give you a wide-open opportunity to knock the ball out of the park. What is this plan that's going to save the day? Give us some description of it.

Mr. Martin Cauchon: In reference to my responsibility, Mr. Chairperson, I'm not used to running away from my responsibility. I accept totally my responsibility as minister.

As regards the plan of action, we have Mr. Baker here, who is going to be responsible for proceeding with the plan. Maybe we should give him the floor for a moment.

The Chair: Okay, you have 15 seconds, Mr. Baker. You're going to get it all in.

Mr. Bill Baker: Fifteen seconds? It's a great plan. We believe the plan is quite comprehensive to address the needs that have been identified by the Auditor General, the needs that have been identified by experts.

It's quite comprehensive. I don't know if you've had a chance to look at it. It focuses on getting costs under control, establishing a better control relationship with our technology providers, better service to the public, making sure that when people call or get on the Internet they get service. It establishes opportunities to engage people in the evolution of this program, recognizing that it continues to need the benefit of input from parliamentarians and others.

Mr. Paul Forseth: What about reporting to Parliament? There's a whole element on transparency--

The Chair: There we have it. It includes reporting to Parliament, I'm sure.

Ms. Jennings, four minutes, please.

[Translation]

Mrs. Marlene Jennings (Notre-Dame-de-Grâce—Lachine, Lib.): Thank you, Mr. Chairman.

Thank you very much for your presentations. First of all, I'd like to comment on Mr. Gaudet question as to whether people would be willing to forgive their Justice Minister. In my opinion, a number of people were responsible for this situation and if anyone is to be forgiven, it might be useful to point out that Mr. Prud'homme, the President of the Fédération de policiers municipaux du Québec, Mr. Pierre-Paul Pichette, a police officer with the City of Montreal, and the Canadian Association of Chiefs of Police all staunchly supported the legislation, the program and so forth.

My question concerns two issues, the first of which is costs. You stated that costs increased as a result of new demands that were made. Mr. Minister, on page 2, in the third-to-last paragraph of your presentation, you give several reasons for these cost overruns. I'm curious as to why these considerations were not factored into the policy implementation process prior to the legislation being adopted and enacted. As a rule some partners have their own areas of responsibility, pursuant to the legislation, while others normally would act in partnership. That's my first question.

Secondly, you mentioned that the passage of Bill C-10A will provide more program options and will greatly reduce costs. Can you explain to me briefly how this bill will improve the program and reduce operating costs?

Mr. Martin Cauchon: I have thirty seconds? I'll start by addressing the cost issue, and let Mr. Baker respond to the question concerning Bill C-10A.

As I stated in my opening remarks, in hindsight, we realized we could not offer the Canadian public the kind of program we wanted to, one that reflected values that were important to us, at the cost originally estimated. Mr. Hession's report also alluded to the fact that we formulated a policy and that subsequently, we found ourselves in the position of having to offer services and, at the same time, having to set up an infrastructure.

Some unexpected demands arose. For example, some provinces demanded that processing centres be set up at various locations, while other provinces withdrew. Again, we hadn't expected this at the outset. Furthermore, some police forces also asked that certain data bases be upgraded. These requests were totally reasonable from a public safety standpoint and it was our duty to comply with them. The fact remains though that we had not initially planned for this.

Various lobby groups with very radical stands on this issue also launched some legal challenges, as you know. This situation forced us to implement a much more aggressive communications program at a cost of a little over $60 million. All of these unforeseen factors combined to drive up program costs.

Bill C-10A is unquestionably a centrepiece, in terms of the action plan or future proposals it sets out. This is clear from the Estimates. On that note, I'll turn the floor over to Mr. Baker.

» (1705)

[English]

The Chair: We'll have to keep Mr. Baker's comments until another time because, unfortunately, Ms. Jennings, you are out of time and therefore--

Mr. Martin Cauchon: I'm sure he has great comments on Bill C-10A.

The Chair: I'm sure she has. We'll hear them in the House, I'm sure.

Mr. Jordan.

Mr. Joe Jordan (Leeds—Grenville, Lib.): Thank you, Mr. Chair.

I have a couple of questions for the Auditor General.

Do the provincial auditors general and you ever get together and talk about common issues and problems? Just a simple yes or no will work.

Ms. Sheila Fraser: Yes. In fact, we meet formally twice a year.

Mr. Joe Jordan: When I read Hession's report, it seems to me that this is more of a systemic problem when it comes to implementing IT projects. I'm familiar with a couple in Ontario. One is POLARIS, which is the computerization of the land registry. The provincial auditor reported very strongly in 2000 on that.

The other is the youth justice tracking project that they tried to put in, which I think was about $329 million, and they've just pulled the plug on that. It's just been scrapped.

Certainly there are common issues when governments do this--and I guess businesses went through this maybe 15 years ago--in terms of the cost overruns, in terms of the complexity. In this case, though, at the end of the day we have an asset; there's something at the end of the day that works. There is some question about bringing the data up to 100%, but certainly the endorsements by the police agencies in the country, I think, would suggest that they are in a position to know and view this as an issue of public safety.

My question is, in this process of addressing what happened here, looking at the issue of supplementary versus main estimates and transparency, but also looking at the administration of the project--and keep in mind that we're looking down the road to things like a national medical database, that there have been some calls for a national DNA database--are there opportunities to learn lessons and apply that to the future expenditure of tax dollars here?

Ms. Sheila Fraser: Thank you, Mr. Chair. I think Mr. Jordan has raised a very valuable point.

As I mentioned earlier, we didn't look at the effectiveness or the efficiency of the program per se, just the costs. I know that in the past the office has done work on systems under development, I believe back in the early nineties, and many of the issues raised are similar to what happened here, or what seemingly has happened here. I agree that there are probably many lessons to learn from this.

The issue that we are of course trying to bring forward to this committee is the lack of information to Parliament on how the project was developing. There may be very valid reasons for why the costs went the way they did, except that Parliament wasn't informed about it.

Mr. Joe Jordan: You stated that you feel the ministry knew in May 2000. It's your view they should have gone to the main estimates then.

Ms. Sheila Fraser: In May 2000, as we note in our report, they estimated at that time that they would need $680 million to complete the program to the end of 2004-05. At that point they were already at expenditures of some $327 million, so at that point they knew that they were over that. Given the reporting requirements that were in place for this kind of project, that's the kind of information, the cumulative to date and the expected costs, that should have been presented in the departmental reporting.

Mr. Joe Jordan: I have question for the minister, then.

I suppose what differentiates this whole undertaking from a database that has, let's say, kept track of wildlife in the country is the issue that it's guns. The lobby for and against on this particular issue, I think, on a global scale has no parallel.

» (1710)

The Chair: You'll have to hurry if you expect a response from the minister, because your time is just about up.

Mr. Joe Jordan: In the annual reports to Parliament, are we going to start looking at the effectiveness of the program in terms of public safety? We've talked a lot about dollars, but we haven't talked a lot about the public safety aspect.

The Chair: Mr. Minister, a very brief response.

Mr. Martin Cauchon: When I say that the system works.... Actually, if you look at the use made by most of the police forces across Canada, it tells you that the system works. There's no doubt in my mind that in the future, since the system is in place and up and running at the present time, based on the experience that we will have with the program, we'll be able to give you a clear answer--

The Chair: We look forward to that, Mr. Minister.

Mr. Macklin, four minutes, please.

Mr. Paul Harold Macklin (Northumberland, Lib.): Thank you.

I'd like to direct a question to the Auditor General. I want to come back to something that was mentioned a little earlier. It deals with the point of accountability. In particular, I understand there has been some discussion about how broadly based this should be in terms of Justice being responsible to account.

I understand that if a person came up for a parole hearing and in fact part of that sentence the person had been incarcerated for had to do with guns, a portion of that sentence would be allocated to guns. Is it your belief that we should be, through this process, having each and every case assessed as to how much of that effort and money that went into the parole hearing, for example, should be accounted for by Justice?

Ms. Sheila Fraser: Thank you, Mr. Chair.

When the project began, the department provided a charter to the Treasury Board Secretariat. As paragraph 10.23 of our report indicates, the charter said, and I quote:

...it was critical that a single point of authority and accountability be established.

So the department itself thought that this was necessary.

The charter went on to say:

The Canadian Firearms Centre provides this single point of accountability in order to manage and ensure that the government's objectives are achieved....

In 1994 the Department of Justice went to the government on behalf of Correctional Service Canada and the National Parole Board and indicated that they would incur additional costs to implement the program. Out of that, those two departments got $126 million.

So it's clear that the Department of Justice saw itself as, or at least indicated early on in the program that it was to be, the single point of accountability. It made the case for those two other departments to receive $126 million. Under that charter, and given the actions that were taken, we would have expected that those moneys, $126 million as an example, would have been included in the total cost of the firearms program, yes.

Mr. Paul Harold Macklin: With respect to the point of accountability in relation to what is being proposed, what we see here is that the justice minister is responsible for the administration of the program, and yet it appears that the program is going to move to the Solicitor General. How does this affect the point of accountability, as you see it?

Ms. Sheila Fraser: As to how that will occur in the future, I would think that would have to be determined between the Minister of Justice and the Solicitor General. Obviously there will have to be some mechanism developed so that those costs can be captured by one place--the Firearms Centre, I would presume, but that may not be the case--and the costs going forward related to that can be reported.

Now, the department or the minister might have more information than I do on the specifics.

Mr. Morris Rosenberg: Perhaps I can very briefly put something on the record. There's an awful lot of information in the AG's report, and I take it a lot of documents were looked at, but I have to say, on this one, with respect, we have a different interpretation on the single point of accountability. Yes, there is a single point of accountability described in the project charter, and we believe it refers to the need for coordination of information and responsibilities within federal departments. My understanding--again, this goes back before my time--is that Justice Canada did not understand this to mean that the department was accountable for funds appropriated by and spent by other departments.

That said, going forward, we have accepted the recommendations of the Auditor General and we are working with her and her office on an appropriate framework for reporting full costs for the program.

» (1715)

The Chair: Just as a final point on that, because the time is up, do you agree with that statement, Ms. Fraser?

Ms. Sheila Fraser: Well, Mr. Chair, I can just tell the committee that when we do our audits, we give copies--

The Chair: I just want to know if you agree with Mr. Rosenberg or not.

Ms. Sheila Fraser: Mr. Chair, we give copies of our reports in advance to a department to ensure that they agree with the facts as presented. We have presented certain facts. It would appear that Mr. Rosenberg may be in disagreement.

The Chair: Okay.

We're going to have a quick round. We're going to try to give two minutes to every opposition party.

Mr. Breitkreuz, are you ready?

Mr. Garry Breitkreuz: Thank you, Mr. Chair.

I just want to make an observation as I begin here, that the minister's answers were quite misleading, especially to the original question I asked. Every one of those long lists of--

Mr. Mac Harb: Come on, Mr. Chair. This is absolutely out of line. The minister took the time to--

Mr. Garry Breitkreuz: Mr. Harb, I did not--

The Chair: Order!

Mr. Mac Harb: You cannot say “misleading”. You know it's not parliamentary. You've been a member for quite some time now.

The Chair: Mr. Harb, order. You address your questions to the chair.

Mr. Mac Harb: Mr. Chair, you'd better pay attention to what these guys are saying.

The Chair: I am paying attention. Now, Mr. Harb--

Mr. Mac Harb: It's absolutely out of line, inappropriate.

The Chair: Order, Mr. Harb.

Mr. Mac Harb: He should apologize to the minister right now.

The Chair: Mr. Harb, order!

Mr. Mac Harb: He should say he's sorry, Mr. Chair.

The Chair: I say stop it.

Mr. Mac Harb: How terrible that is.

The Chair: Order!

I'll have no more comments from you, Mr. Harb.

Mr. Mac Harb: Well, he'd better apologize, Mr. Chair, you know that. This is most inappropriate.

The Chair: I will have no more comments.

Mr. Mac Harb: This is not parliamentary--

The Chair: Mr. Harb.

Mr. Mac Harb: --this is not accepted, and he'd better withdraw now.

The Chair: You have the floor, Mr. Breitkreuz.

Mr. Garry Breitkreuz: I would like to say that in answer to my first question, there was a long list of reasons given why the costs of the--

Mr. Mac Harb: He said something unparliamentary.

The Chair: I heard you, Mr. Harb.

Mr. Mac Harb: Well, I need a withdrawal before we proceed. You know the rules, Mr. Chair. I don't have to tell you the rules.

The Chair: Order!

Mr. Breitkreuz.

Mr. Mac Harb: Can we have a retraction?

The Chair: Mr. Breitkreuz, you've been asked by Mr. Harb to withdraw. You have the choice. If not, Mr. Harb can raise that in the House.

Mr. Garry Breitkreuz: Yes, go ahead and raise it in the House. I didn't say anything inappropriate.

The Chair: Okay, there you go, Mr. Harb.

Mr. Breitkreuz, you have the floor.

Mr. Garry Breitkreuz: There was a long list of reasons given as to why the costs spun out of control. Every one of those reasons could be countered. You, sir, know that the report that was given to the justice minister back in 1994 carefully explained that the costs would go way beyond what the department had said. I have that report. I can give it to you, but it was your responsibility to read it. The costs would go way beyond what was originally documented.

Some of the reasons that you have given, sir, just don't hold any water. I only have a couple of minutes, but, for example, the provinces opting out of the registry don't materially change the actual costs of the registry, yet you gave it as a major reason. There's only one taxpayer in this country. So I think it's incumbent on you to really....

But my question is that now, in the last few days, you've come up with this proposal that we're on cash management; what is cash management? I believe you're taking Parliament for granted. You're assuming they're going approve some future expenditure. Is that not in fact true?

The Chair: Okay. You have a question. You can get a very brief answer.

His question is, what is cash management, Mr. Minister?

Mr. Garry Breitkreuz: The minister should know.

The Chair: Mr. Rosenberg.

Mr. Morris Rosenberg: I can start. What our senior financial manager here--

The Chair: I'm going to cut you off. You have to be quick.

Mr. Morris Rosenberg: Okay. On cash management, we think--and the Speaker of the House ruled to this effect--we do have a responsibility to administer and enforce legislation that was passed by Parliament. Bill C-68 was passed by Parliament.

The Chair: Okay, but you also said....

I'm not going to let Mr. Breitkreuz have the floor; his time is up. So I'm basically going to say, you can't spend money that Parliament didn't give to you either.

So now we're going to go on to Mr. Desrochers.

[Translation]

You have two minutes, Mr. Desrochers.

[English]

Mr. Martin Cauchon: The money was given to us.

[Translation]

Mr. Odina Desrochers: Thank you, Mr. Chairman.

[English]

Mr. Martin Cauchon: We're managing money given to us within our department for programs that we're responsible for.

The Chair: Minister, you can only spend the money that Parliament gave to you. If Parliament didn't give you the money--

Mr. Mac Harb: Mr. Chair, excuse me, on a point of order--

» (1720)

The Chair: On a point of order, Mr. Harb.

Just leave it alone.

Mr. Mac Harb: Mr. Chair, you're not the one asking the question; we have an individual who's asking the question. Your prerogative as a chair is to conduct a balanced hearing. We've had a good hearing so far, and I would suggest, Mr. Chair, that you stay out of it. When the member is asking his question, allow the witness to answer.

The Chair: He did.

Mr. Mac Harb: It's not your responsibility to interpret what the member is asking.

The Chair: And it's not your responsibility to--

Mr. Mac Harb: Well, it is. You have to conduct a fair hearing, and you're not.

[Translation]

The Chair: You have two minutes, Mr. Desrochers.

Mr. Odina Desrochers: I can understand Mr. Harb wanting to defend his Liberal government. He needs to take a deep breath. We're asking questions and we want answers.

Mr. Rosenberg, you stated that program costs had already escalated to $688 million by the time Mr. Cauchon was appointed to the Justice portfolio. Could you provide us with a cost breakdown at this point in time, since you're here? Can you give us a line-by-line breakdown of this $688 expenditure?

Mr. Morris Rosenberg: I can try.

Mr. Odina Desrochers: It doesn't have to be right this minute. You can send us a detailed response.

Mr. Morris Rosenberg: We can send you a detailed breakdown, line-by-line, in English.

[English]

That's program administration, communications and public affairs, Canadian firearms registration system development and maintenance, program delivery, and national weapons enforcement support team.

[Translation]

I'll have that information sent to the committee.

Mr. Odina Desrochers: I have one final question, Mr. Chairman.

Last Friday, Mr. Cauchon announced that he was transferring this file to the Solicitor General.

Who will be accountable for the Canadian Firearms Program after April 1?

Mr. Martin Cauchon: The program will be transferred over to another department as of April 1. From that moment forward, responsibility for the program will rest with the Solicitor General. If you look at the action plan submitted last Friday, you will see that it addresses the different concerns expressed by Canadians, and at the same time, responds to the AG's recommendations. Moreover, I believe that the Solicitor General...

[English]

The Chair: I'm going to stop you there, Mr. Minister, because time is running short. Many people want to ask more questions. So I apologize, but we do have to move on, because Mr. Gallaway would like to ask a question.

Mr. Roger Gallaway (Sarnia—Lambton, Lib.): Chair, Minister, I want to go back to the beginning. As you suggested, April 24, 1995, your predecessor arrived and said $85 million would be the cost. He said, and I'm quoting now:

I maintain that the figures I've put before the committee are our best estimate, based on reasonable assumptions, calculated responsibly, and reflecting all of the costs of establishing the registration system.

He also went on to attack the witness who he maintained had worked for the NRA and who had said it would cost $1 billion. That witness was an academic from Simon Fraser. The minister was the last witness at that time, after seven attorneys general had appeared before the committee and said they would never comply with the law, they would never cooperate.

So I'd like to ask you, first, would you apologize to that witness on behalf of the department? He said it would cost $1 billion. Your department said $85 million. Would you apologize to him for the harm done to his academic career as a result of that attack? Second, would you apologize to those who accepted the policy based on the reasonable cost assumption and assertion made by your department?

Mr. Martin Cauchon: When we had decided as a government to proceed with the gun control program back in 1995, we had to come forward, of course, as the member said, with some assessment, and of course nobody had a crystal ball at that time. It was the very first time that in Canada such a program was put in place. We weren't really aware of the number of gun owners, the number of firearms as well that we have in Canada. For us to proceed with any forecast in terms of numbers was quite difficult at that time, and I believe, Mr. Chairman, that they used the best numbers they had, and the best figures they had as well, in order to come forward with the number they used at that time.

Having said that, in retrospect when you look at the numbers, when you look at the additional requests that have been made, the additions that we've made to the program, it seems quite obvious that it was impossible to deliver the program for such an amount. But in all that, I have to tell you, Mr. Chairperson, all the people have been working and acting in good faith with the numbers and the figures they had at the time they took their decision.

Mr. Roger Gallaway: On that same day, appearing with the minister were department officials by the name of Jim Hayes, Richard Mosley, and Irit Weiser, who still work in the department. They were here to bolster the minister, to give him credibility. You've brought two today. You've maintained that in retrospect none of this could have been true. The problem of course we're all encountering is credibility. What has changed to make you more credible than your predecessor?

» (1725)

Mr. Martin Cauchon: The question is interesting. When you look to the past at the number of times we've used the supplementary estimates, it tells you that we've added a lot of components to the program from 1995 up until now. As a matter of fact, Mr. Chairperson, what we were doing from 1995 was just building from scratch a very good, fantastic gun control program, which is in place and offers benefits to the Canadian population.

Now that the registration system is in place and the licensing system is in place, of course it's easier to forecast numbers in the future. So at this point in time, the projections we've made in our plan of action are based on reports that we've obtained from outside consultants. In this model that has been developed, numbers are based on risk assessment as well. And as I've said, you have to look at all the components, one component being Bill C-10A.

I thank the member for his question.

The Chair: Thank you very much.

And now we're going to go to Ms. Wasylycia-Leis for basically one question. Two minutes.

Ms. Judy Wasylycia-Leis: I don't think anything that's been said today detracts from the fact that this government has tried to play hide-and-seek with Canadians and got caught. And I think the purpose of today's meeting is to try to see if we can learn something on what happened and to prevent the problem from happening in the future. It sure doesn't help to hear about how the numbers were all there in supplementary estimates, and so on and so forth, when in fact the minister knows that as members of House we barely get to the main estimates, never mind supplementary estimates.

So I think the issue here is really, as the Auditor General said in her recent statement, that there's one fundamental question to be asked, and that is whether the department was acting in the best interests of parliamentary accountability. Can you answer that question? And if you agree with the Auditor General, could you say what you intend to do to make sure that transparency and accountability is the name of the game from here on in?

Mr. Martin Cauchon: In terms of the facts, as I said, there are always two sides of the coin. We believe that we have been reporting based on our obligation, if you refer to the rules of the Treasury Board.

Having said that, we said that we accept the recommendations of the Auditor General, and if you look at the action plan, we can't be clearer than that: audits on a yearly basis, reporting to Parliament as well on a yearly basis, and strong action taken on the management side. So we're already answering some recommendations of the Auditor General.

For the rest, as I said during the hearing today, her department and my department are working closely together in order to make sure we will be able to come forward with all the numbers.

The Chair: Thank you, Ms. Wasylycia-Leis.

Mr. Keddy, two minutes.

Mr. Gerald Keddy: Thank you, Mr. Chairman.

I don't know how we're supposed to summarize this in two minutes, but I'm willing to try to do that and get an answer.

The responsibility for the gun registry is the issue that I've still not been able to get a grasp on. Apparently, from the comments that have been given, really there's no one responsible. With respect to the Minister of Justice--and I appreciate the circumstance you're in--you've come here today and you've told us that you've taken responsibility for the registry, that you've implemented an action plan. You have a little more than five weeks before April 1, before that action plan is supposed to be entirely in place.

It seems to me that if you were taking responsibility for this registry, then you would fix it before you hand it over in a simple lateral movement to someone else, and as soon as that person has responsibility, the other department has responsibility, you don't have to answer questions on it. So between you and your deputy minister, there's been no responsibility taken, there's no one fired, no one has lost their job, and the Prime Minister is on the record as saying that someone should be punished for this transgression, for this money that's been spent.

The Chair: I have to interrupt there, Mr. Keddy, if we want an answer to your question in 30 seconds.

Mr. Martin Cauchon: I would like to point out, Mr. Chairperson, that we built a system and, actually, the Canadian population has an asset as well that already gives some benefits.

With regard to the future and the plan of action, I have said to the Canadian population that I wanted to table a plan of action. A plan of action was tabled last Friday, and we will move forward with that plan of action, which will have to be implemented over the next 12 months.

As a conclusion, an important component is Bill C-10A, but as well, transferring to the Solicitor General that program, which is a natural fit.

» (1730)

The Chair: We know about that.

I'm going to have to wrap up.

Mr. Martin Cauchon: And I believe it would be irresponsible to wait another year before transferring it if it's an important component of the action plan. That's why we decided to do that, Mr. Chair.

The Chair: Thank you very much.

Now I have a simple question to the Auditor General, because I think you've been following what's going on. In a press release dated February 3, 2003, the Department of Justice stated the following, and I quote:

The first report, by consulting firm KPMG, has allowed the Department of Justice to confirm that the necessary systems are in place to ensure the integrity and completeness of relevant financial data. This work has provided the Department with confidence that the information compiled on past expenditures is accurate. This information is what was reported to Parliament in the Public Accounts.

It's their words.

You halted your audit on the financial information given to you by the department because the information, in your words, “does not fairly represent the cost of the program to the government”. So how do you respond to the statement by the department?

Ms. Sheila Fraser: Thank you, Mr. Chair.

I understand that the mandate given to KPMG was to do what we call “limited procedures” on the expenditures of two years, so they selected a certain number of transactions and ensured that those transactions, for instance, had proper authority, proper signatures, and were correctly recorded in the accounts.

I think the department will agree with us that it was not meant to give a full and complete accounting of the costs, as we had requested in our audit and which we indicated the department was not able to do for us.

The Chair: Thank you.

I have a question to the minister from your performance report for the year ending March 31, 2002. This would have been written last summer, and I quote:

The program

--that's the firearms registry--

to register firearms in Canada is in its final year of implementation, with the vast majority of guns expected to be registered by the legislated deadline of January 1, 2003.

It's the final year. Didn't you know by June of last year, six months ago, that you were in serious trouble?

Mr. Martin Cauchon: When you say “final year”--

The Chair: They're your words.

Mr. Martin Cauchon: Yes, the deadline for registration was the end of last year. So we were in the final year of implementation.

The Chair: And you expected most to be registered?

Mr. Martin Cauchon: We were expecting compliance from the Canadian population.

When you look at the number of firearms that have been registered so far, Mr. Chairperson, we're talking six million. So we're getting there. We have very good assets and we have a very good-quality data bank as well.

The Chair: To Mr. Rosenberg, will you ask your department to table with this committee all the regulatory impact analysis statements you'd talked about earlier for the firearms program?

Mr. Morris Rosenberg: I will, Mr. Chair.

The Chair: Okay.

Mr. Mahoney, two minutes.

Mr. Steve Mahoney: Mr. Chairman, my questions are to the minister.

Given that statements continue to be made that the gun registry specifically cost $1 billion, could you tell us your understanding of what percentage of the total $688 million cost for the entire gun control program is related to the registry? Could you tell us your understanding of where this so-called cost of $2 million came from?

As a final question, have the hysteria and the political distortion of the facts hurt gun control in this country?

Mr. Martin Cauchon: I don't have the exact numbers in front of me.

Mr. Steve Mahoney: Do you have any percentages?

Mr. Martin Cauchon: Broadly speaking, for the licensing stage we're talking about 65% of the cost, therefore 35% for the registration.

Mr. Steve Mahoney: That would be roughly $225 million, then, for the registration.

Mr. Martin Cauchon: Roughly, yes.

Mr. Steve Mahoney: And the $2 million, where did it come from?

Mr. Martin Cauchon: From the administration. The forecast was based on revenues, but of course, being faced with a strong lobby that was strongly opposed to the notion of gun control, we had to proceed at that time on fee waivers. We lost some revenue because of it, and that's why the figure at the very beginning--

Mr. Steve Mahoney: Given that your view would be that gun control is an important program for all Canadians, do you believe this distortion has hurt gun control in this country?

Mr. Martin Cauchon: About 74% of the population, according to the last poll I saw, still supports gun control in Canada.

» (1735)

The Chair: Okay.

We normally wrap up with some final comments by the Auditor General. We're a little bit over our time, so I'll ask her to be fairly brief.

Ms. Sheila Fraser: Thank you, Mr. Chair.

I'd like to thank the committee for the hearing today. The issue we were really trying to bring forward was information to Parliament in the accountability process. I am pleased that the department and the minister in particular have accepted our recommendations and are committed to providing more transparent and complete information on this program.

I look forward to our future hearings and hope that the committee will develop perhaps lessons learned from this to ensure that a similar situation doesn't occur in the future.

Thank you.

The Chair: Okay.

We don't normally have ministers before the committee. Does the minister have a final comment?

Mr. Martin Cauchon: I would just like to thank you very much, Mr. Chairperson, and all your colleagues.

One more time, thanks to the Auditor General for the report. I guess the aim and the goal is to make sure that together we are able to provide the Canadian population with a good gun control program.

What I've found--and I felt this today, around this table--is that we're all heading in the same direction. We're strongly committed to making sure that the system will work, and we'll have a close look at our action plan.

Thank you very much.

The Chair: Ladies and gentlemen, the meeting's adjourned.